Category: AJH Advocacy

When a lawyer seeks ‘wasted costs’, they are not asking for their client’s costs to be paid by the other party; they are seeking to have the costs paid by the other party’s legal representatives.

The term wasted costs is usually, and erroneously, interchanged. It is likely that the Court appreciates what is actually being sought, but it is a pet hate of mine.

What is a wasted costs order?

CPR 46.8 regulates the court’s authority to impose “wasted costs orders” against legal representatives under s51(6) Senior Courts Act 1981. It addresses the personal liability of lawyers, including solicitors and barristers, but also any regulated lawyer. This is a discretion available to the courts that is invoked to compensate parties for costs wasted due to misconduct of legal representatives.

A wasted costs order can disallow costs or permit the recovery of costs from the legal representative instead of the party. This is particularly important in situations where recovering costs from the party is impossible, such as under QOCS, but the conduct of the legal representative caused the costs.

The Ridehalgh v Horsefield test

In Ridehalgh v Horsefield [1994] Ch. 205, CA, the Court of Appeal examined the jurisdiction to award wasted costs under the Courts and Legal Services Act 1990. It emphasised that litigants should not suffer financial prejudice from unjustified conduct by their own or their opponent’s lawyers. Courts must also be cautious when awarding wasted costs to avoid creating a costly new form of satellite litigation.

Before ordering a wasted costs order, a three-stage test should be applied: 

(a) Did the legal representative in question act improperly, unreasonably, or negligently?

(b) If so, did this conduct cause the applicant to incur unnecessary costs? 

(c) If yes, was it appropriate, considering all circumstances, to order the legal representative to compensate the applicant fully or partially?

The test in Ridehalgh was later adopted as the acid test for unreasonable conduct costs awards in the small claims track CPR 27.14(2)(g) in the case of Dammermann v Lanyon Bowdler LLP [2017] EWCA Civ 269.

Was the conduct improper, unreasonable, or negligent?

These terms are broadly interpreted but with important nuances. “Improper” conduct encompasses not only behaviour that deserves professional discipline but also significant deviations from proper standards. “Unreasonable” conduct covers actions that are vexatious or intended to harass rather than support the case, even if driven by excessive enthusiasm. “Negligence” is understood in a general sense, meaning a failure to meet the standards of a reasonably competent professional.

Causation between the conduct and the loss

There must be a causal link between that conduct and the costs incurred. The court must be satisfied that the legal representative’s actions caused unnecessary costs to be incurred or rendered previously incurred costs wasted. Without such causation, no order can be made. I once made an argument where the Judge was with me on the conduct point, but found that the costs incurred would have been incurred in any event.

Is it reasonable in all the circumstances to make the Order?

Even where fault and causation are established, the court must consider whether it is just in all the circumstances to impose liability. This reflects the discretionary nature of the jurisdiction and ensures that wasted costs orders are not imposed automatically.

‘Show cause’ opportunity

CPR 46.8(2) promotes fairness to legal representatives by providing a mechanism that prevents a wasted cost order from being made immediately, often because the representative did not anticipate such an argument. They must be given a reasonable chance to respond, either in writing or at a hearing, before any order is issued. The court can decide the amount of wasted costs itself or direct a costs judge to assess it.

Additionally, the court may require that the representative’s client be informed of the proceedings or any resulting order. In practice, courts usually follow a two-stage process.

The first stage involves assessing whether there is a strong prima facie case justifying further investigation and whether pursuing the matter would be proportionate. If these criteria are met, the second stage involves a thorough review of the legal representative’s conduct after providing them with an opportunity to respond. This is informally referred to as showing ‘just cause’ and once the prima facie has been established, it is for the respondent to such an application to demonstrate why such a costs order should not be made. It is not for the respondent to demonstrate in thre is no prima facie case. CPR 46.8 is intended to be an exceptional costs direction.

Courts are wary of allowing wasted costs applications to turn into complex, satellite litigation. Therefore, applications are often postponed until after the trial and may be denied if they require detailed factual investigation or if the costs of the application are disproportionate.

Conclusion

Seeking your ‘wasted costs’ when you actually mean the costs of and occasioned by an event, or costs thrown away, is unlikely to lead to any complications. Judges will question whether you meant seeking your client’s costs from the other party and I doubt that it will lead ot an unitended consequence.

Just remember that when you instruct counsel to seek, or invite the court to make a wasted costs order, you are asking the Court to make a legal representative personally liable for costs caused by their improper, unreasonable or negligent conduct. It is a high threshold test.

Whilst Ridehalgh was adopted as the acid test in Dammerman, the application of those cases in CPR 27.14(2)(g) is different. In those circumstances, you are still seeking costs from the other party, but you are asking the court to exercise discretion to allow costs not usually allowed in the small claims track.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

I have decided to make a Tetralogy regarding the deductions from a child’s personal injury damages. consisting of:-

• Chapter 1 – ATE premiums
• Chapter 2 – Success fees
• Chapter 3 – Costs shortfall contribution 
• Chapter 4 – Payments out

Success fees are probably the most common deduction from a child’s damages. I am not sure why I didn’t write about it first. Nevertheless, it is an important topic.

What is a success fee?

A success fee is an additional liability that was made available to Solicitors who entered into a conditional fee agreement to account for the additional risk they took for taking on a case, whereby the Solicitors may not get paid for the work they undertake unless their client is successful.

The client instructs a solicitor on a CFA basis, so there are no upfront payments (although the firm may request money for disbursements). If the claim is lost, then no costs are charged by the Solicitors. If successful, the success fee is raised alongside the basic charges.

The percentage of the success fee could not exceed 100%, but the success fee had to be justified, usually by attributing the percentage to the risk. For example, a case which has low risk and high prospects with an early admission is not going to attract the same litigation risk as a highly complex and contested accident with both facts and law in dispute. In order to determine this, a solicitor would carry out a risk assessment at the outset of the claim.

However, who paid that success fee has changed as a result of the Jackson reforms.

Pre 1st April 2013

The success fee was an additional liability that was recoverable from the third party upon a successful case, leading to a right to recover costs. For these reasons, a Notice of Funding had to be filed with proceedings,, otherwise the Claimant would be unable to recover the success fee from the paying party. Once the right to costs came about, the bill of costs was drafted, which would include the success fee.

The success fee was usually a percentage of the base costs. So if a Claimant’s solicitors had incurred £6,000 of costs, and the success fee was 100%, then the success fee would be £6,000. Understandably, there would be circumstance whereby the Claimant’s success fee percentage would be challenged by the paying party. The cherry on top is that any CFA entered into between the Claimant and their instructed counsel was also subject to a success fee.

However, that changed following the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO), which applied to any CFA entered into on and after 1st April 2013.

Post 1st April 2013

Since LASPO, success fees are not recoverable from the Defendant in personal injury claims where the CFA is entered into after 1^st April 2013. Instead, they are usually deducted from the claimant’s damages. Any deduction is restricted by the LASPO and the Conditional Fee Agreements Order 2013. Essentially, any deduction or contribution from the Claimant’s damages must not exceed 25% and cannot be deducted from anything other than from PSLA and past losses.

Claimants can challenge the costs, and in turn, the success fee, by virtue of s70 Solicitors Act 1974. However, the question comes to success fees when they are children and are subject to CPR 21.10.

Herbert v HH Law Limited [2019] EWCA Civ 527

The first question is whether the litigation friend (who has entered into the CFA in order to pursue the child’s claim) has consented to the success fee. The relevant case is Herbert v HH Law Limited.

Ms Herbert instructed HH Law under a CFA after an RTA. The CFA allowed for a 100% success fee, limited by a 25% cap on damages. The claim settled for £3,400, with the solicitors deducting £829.21 for a success fee, plus an ATE insurance premium from her damages. Ms Herbert challenged these costs under s70 of the Solicitors Act 1974, claiming she wasn’t informed about the success fee and that it was unreasonable.

The Court of Appeal stated that “approval” under CPR 46.9(3) means informed approval, which requires a proper explanation to the client. The solicitors did not demonstrate informed approval for the 100% success fee because it was set as standard without considering litigation risk. This unusual practice should have been explained. As a result, the success fee was reduced to 15%.

Duffield v WM Morrisons Supermarket Limited

HHJ Monty KC, sitting in the County Court at Central London, heard an appeal from DDJ Walton regarding the deduction of the cost of the ATE premium and success fee. This article will focus solely on the ATE premium element.

The DDJ had allowed some of the success fee, but refused the ATE premium in its entirety. The Judgment of the DDJ was short and given verbatim in the Circuit Judge’s judgment. Whilst the DDJ was willing to find that there was risk, despite the criticism of the risk assessment, he found that the appropriate deduction should be 10% based on Simmons v Castle [2012] EWCA Civ 1039, which increased PSLA general damages to account for the additoinal libailities that must now be deducted from the Claimant’s damages.

The Circuit Judge allowed the appeal on the success fee because the success fee was a contractual agreement between the Solicitors and the litigation friend. It was wrong for the Judge to use Simmons v Castle as a starting point because that was in relation to the measurement of damages, not to solicitor-client assessment of costs.

Further, the Circuit Judge referred to the approach in Herbert v HH Law as the correct approach under CPR 46.9, ensuring informed consent from the litigation friend and applying the presumption of reasonableness to costs incurred with the client’s approval, unless evidence suggests otherwise. In this case, the litigation friend understood and approved the CFA, confirming the reasonableness of the success fee.

Very similar to the approach of ATE, CPR 46.9(3) has a presumption that the costs are reasonably incurred. There is a mechanism in place to challenge the costs if there are any concerns.

How are basic charges determined for a CFA?

In most CFAs, the basic charges are determined by the hourly rates and the amount of time spent progressing the matter. Therefore, if a firm spent £3,500 on conducting the matter, then the success fee would be £3,500 at 100%. However, some firms would define basic charges as the costs that can be recovered from the third party where the fixed costs regime would apply.

This would make it easier for a client to understand the likely liability for a success fee on the basis that the fixed cost regime was prescriptive to a certain extent (for example, any costs determined by the value of damages would be speculative, but a case that settles in the MOJ portal would have a prescribed set of fixed fees.

This reduces the size of the success fee, and would not take into account any complexities that would require more time. Whilst it would be considered fairer for Claimants who would require the success fee to be paid out of their damages, it would penalise firms who did significantly more work, but did not get remunerated for that time because of the fixed costs regime.

The percentage of success fee and cap on deductions from the damages are not interchangeable

A Litigation Friend, who incurs a success fee (for example) of 75% does not have that success fee reduced to 25%, but the cap of the pool of the damages that can be deducted from is limited to 25%.

So imagine a Litigation Friend’s solicitor has settled the Claimant’s case for £6,000 for PSLA only. The amount of work undertaken is £8,000 and the success fee is 75%, equating to £2,000. The success fee maybe £2,000, but the cap is £1,500. Therefore, the cap prevents more than £1,500 being deducted from the damages.

I have had many Judge states that a ‘25% success fee is being sought’, when that is not the case and interchange damages cap and success fee when they should not.

The approval process.

CPR 21.12 dictates how deductions from a child’s damages can be made and under what circumstances. Whilst costs that are to be deducted from the damages are usually to be assessed on detailed basis, CPR 21.12(2)(c) says that the detailed assessment can be dispensed with in accordance with CPR 46.6(5):-

(5) Where the costs payable comprise only the success fee claimed by the child’s or protected party’s legal representative under a conditional fee agreement or the balance of any payment under a damages based agreement, the court may direct that—

(a) the assessment procedure referred to in rule 46.10 and paragraph 6 of Practice Direction 46 shall not apply; and

(b) such costs be assessed summarily

This means the Court can summarily assess the costs that are to be used as a basis for determining the success fee.

The Litigation Friend, in accordance with CPR 21.12, must also file a statement setting out, so far as a applicable, the following:-

(a) the nature and amount of the costs or expenses and the reason they were incurred;

(b) a copy of any conditional fee or damages based agreement;

(c) a copy of any risk assessment by reference to which any success fee was determined;

(d) the reasons why the particular funding model was selected;

(e) the advice given to the litigation friend on funding arrangements;

(f) a copy bill or informal breakdown of the solicitor and own client base costs incurred;

(g) details of any costs agreed, recovered or fixed costs recoverable by the child; and

(h) an explanation of the amount agreed or awarded for—

(i) general damages for pain, suffering and loss of amenity; and

(ii) damages for past financial loss, net of any sums recoverable by the Compensation Recovery Unit or the Department for Work and Pensions.

This ensures the basis for the success fee can be reviewed by the Judge to ensure it is compliant. As it is a contractual agreement between the Solicitor and the Litigation Friend, there is a presumption that the costs are reasonably incurred and reasonable in amount.

So how should the Court consider the success fee for the purposes of approving any payment out for the same?

The Court must start by considering whether CPR 21.12(10) has been complied with and whether the appropriate documentation has been provided. If any documents vital to determining the success fee are missing, no success fee deduction should be allowed.

If the Solicitors have defined the basic charge for the success fee calculation as their hourly rates and work in progress, then, without a breakdown of those costs, the Court cannot possibly consider whether the success fee is correct/accurate/reasonable/proportionate.

The starting point would be to consider the success fee percentage and whether there was informed consent. If there is sufficient evidence of informed consent, then the Court should not touch the success fee.

If informed consent is doubtful, then the Court must consider whether the success fee is justified by the risk assessment. If it were a blanket 100% with no consideration of the risk, then the rebuttable presumption that it was reasonable and proportionate falls away. The court can then consider the appropriate success fee.

The same approach applies to the costs incurred. If informed consent is doubtful, are the costs unusual in nature and amount to displace the rebuttable presumption? If so, the Court can carry out a summary assessment of those costs because CPR 46.4(5) can allow the costs to be summarily assessed, rather than subject to detailed assessment.

In low-value personal injury cases, these possible reductions in the success fee percentage and summary assessment of costs may very well have no influence on the deduction. If 25% of the damages is £600 and the success fee is reduced from £3,000 to £1,000, the cap is still £600 and the assessment becomes an academic exercise. However, that may not alwasy be the case.

Why should the success fee be paid out of a child’s personal injury damages?

Success fees should be capable of being deducted from a child’s personal injury damages because solicitors acting under a conditional fee agreement assume a significant financial risk in pursuing claims on a CFA basis (at their own detriment).

If the claim is unsuccessful, the solicitor receives no payment for the work undertaken and absorbs the cost of the litigation risk. The litigation friend, who is responsible for conducting the claim on behalf of the child, knowingly enters into the CFA and thereby accepts the contractual liability for the success fee in the event that the claim succeeds. The rules allow that success fee to be recovered from the child’s damages.

Allowing a reasonable success fee to be deducted from damages therefore reflects the commercial reality that solicitors must be incentivised to take on such cases, particularly where there is uncertainty as to liability or quantum.

Importantly, this does not leave the child unprotected. The Court retains supervisory jurisdiction over settlements involving minors, and there are established mechanisms, such as detailed assessment and the court’s approval process, to scrutinise costs that appear unusual in amount or nature and to ensure that only fair and reasonable deductions are permitted. However, that mechanism is where there is doubt about the informed consent.

Whilst many say that this seems unfair on the Claimant child, remember that they would have no damages at all but for the financial risk undertaken and incurred by both the Solicitors and the Litigation Friend.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

Dogs have long been companions and workers, and many families in the UK love having dogs as pets. People value their loyalty, intelligence, and emotional bond. I never knew how much satisfaction it brings to have a dog until I had one myself. However, dogs can sometimes cause harm or damage; it is a sad reality we must all accept, even if more often than not (or the majority at large) are very safe. The law aims to balance loving dogs with keeping the public safe and protecting property.

The Animal Act 1971 is the usual mechanism relied on by those who have sustained injury as a result of a dog-related incident. This article considers this Act and the relevant elements with respect to dogs.

Who is the keeper of the dog?

The definition of a keeper can be found in the 1971 Act, s6(3) and s6(4) say that a keeper can be:-

1. The person who owns the dog.
2. The person who possesses the dog.
3. The ‘head of the household’ is the person who owns or has possession of the dog if the person is under 16 years of age. 
4. The previous person who owned or possessed the dog until someone becomes the keeper within the meaning of the act. 

A person is not a keeper if they take and keep the dog into their possession to prevent it from causing damage or until it can be returned to its owner.

Can a dog fall within the definition of a dangerous species?

Strict liability for dangerous species, as per s1 and s2(1) of the 1971 Act, means a keeper is automatically liable for damage caused by the animal. The Claimant only needs to prove the keeper and injury, with no need for negligence or fault. Liability applies even if the keeper was cautious and unaware of the danger.

The definition of a dangerous species is found in s6(2) of the 1971 Act:-

(2)A dangerous species is a species—

(a)which is not commonly domesticated in the British Islands; and

(b)whose fully grown animals normally have such characteristics that they are likely, unless restrained, to cause severe damage or that any damage they may cause is likely to be severe.

A dog is a species that is commonly domesticated in the British Islands and therefore cannot fall within the definition of a dangerous species.

What would need to be proven to establish liability under s2(2) in respect of a dog?

There are three limbs to s2(2) that need to be met for injury that has been caused by an animal that does not belong to a dangerous species.

1. The damage is of a kind which the dog, unless restrained, would likely to cause or which, if caused by the dog, it was likely to be severe 
2. The likelihood of the damage or of its being severe was due to characteristics of the dog which are not normally found in animals of the same species or are not normally so found except at particular times or in particular circumstances
3. Those characteristics were known to that keeper or were at any time known to a person who at that time had charge of the dog (falling within the definition of ‘keeper’).

A Claimant must meet all three of these limbs to establish liability. The 1971 Act is well known to be difficult and contradictory and therefore is not a simple question. 

Likelihood of damage

There are two ways to establish limb one of s2(2)(a), either was it the kind of damage that, if the dog was unrestrained, was likely to be caused or if it caused damage, the damage was likely to be severe.

It is an ‘either/or’ approach, and the Claimant needs to establish only one. It is likely that dogs with a history of attacking other dogs would, if unrestrained, cause injury to people who may intervene. The possibility of the damage a dog could cause (and damage, as per s11 of the 1971 Act, includes death of/or injury to any person) was likely to be severe.

S2(2)(a) is establishing the foreseeability element of the dog. In other animals, the test may not be so easily established, such as horses in horse-riding accidents (leading to fact-specific analysis by the Court as per (Turnbull v Warrener [2012] EWCA Civ 412). 

Due to the particular characteristics

The mere fact that a dog could cause severe injuries or could have caused injury if unrestrained is not, of itself, sufficient. There needs to be something about the dog’s characteristics that is either not seen in other dogs or not at all, except at a particular time or in particular circumstances. As domesticated animals are not usually known to attack without any sort of provocation, that would be a particular characteristic not normally found

The example given in Mirvahedy v Henley [2003] UKHL 16 really helps to explain this point.

Para 46

Some forms of accidental damage are instances where this requirement could operate. Take a large and heavy domestic animal such as a mature cow. There is a real risk that if a cow happens to stumble and fall onto someone, any damage suffered will be severe. This would satisfy requirement (a). But a cow’s dangerousness in this regard may not fall within requirement (b). This dangerousness is due to a characteristic normally found in all cows at all times. The dangerousness stems from their sheer size and weight. It is not due to a characteristic not normally found in cows ‘except at particular times or in particular circumstances‘.

So, if a dog that tended to attack other dogs rushed towards another dog to carry out such an attack and knocked the claimant over, causing injuries, this could be said to be caused by a characteristic not normally seen in dogs. However, that logic may not apply to dog breeds that have that characteristic. Generally, just because a trait or characteristic is rare does not mean it is abnormal. For it to be a normal characteristic, it ought occur with some frequency or predictability (Welsh v Stokes [2007] EWCA Civ 796). 

In Gloster v Chief Constable of Greater Manchester Police [2000] All ER (D) 389, a police constable was bitten by a trained German Shepherd police dog during a pursuit when the handler slipped and the dog broke free. The central issue was whether the dog’s police training amounted to a “characteristic not normally found” in German Shepherds under s 2(2)(b), thereby triggering strict liability. The Court of Appeal dismissed the appeal, deciding that the dog was acting based on training, not abnormal behaviour, and there was no evidence that the damage was due to an abnormal characteristic. The requirements of s 2(2) were not satisfied.

Then we come to the point of particular times or in particular circumstances. 

In the case of Curtis v Betts & Anor [1990] 1 ALL ER 769, the Defendants owned a large, usually calm Alsatian dog, which was territorial and guarded its home. The Claimant was walking with his mother past the house. The dog, which was behind a gate in the front yard, got out and attacked the boy on the street, causing serious injuries to his face. The evidence suggested that the dog was not generous viicious, but it did bark and growl at passers-by and was protctive of its terriority

The Defendants appealed on the basis of whether a dog exhibiting territorial aggression would qualify as a characteristic under s2(2)(b). The Court of Appeal dismissed the appeal, finding that the territorial aggression characteristic could be common in dogs generally, but manifested in particular circumstances would satisfy the second limb of s2(2)(b). The limb of s2(2)(c) would be the next part of the test.

We know our dogs can, as they get older for example, start to act differently due to general wear and tear like we do. As we get affected by arthritis and other symptoms, so do our dogs. Therefore, dogs may start to respond more aggressively in particular circumstances when they never done so before.

The characteristics were known to the keeper

The final limb of s2(2) is intended to ensure that the Court is satisfied that the characteristics are known to the keeper. This can sometimes be a very strong defence for the keeper, as the Claimant bears the burden of discharging it. In practice, this can be evidence in the form of veterinary records (with reports that the dog had shown the aforementioned characteristic) or a police report following an incident. A Claimant might seek to contact nearby neighbours to see if they are able to shine any light on the characteristic being known to the keeper.

It is important to note that the type of knowledge is based on which of the two limbs is utilised in s2(2)(b). Returning to Curtis, the Court of Appeal was satisfied that the keeper knew the dog was territorial and defensive, barking and growling at passers-by and guarding the house. It was not necessary to predict the exact attack or fully understand the risk, the Claimant only had to show that the keeper knew the dog’s tendencies.

Statutory defences

As s2(2) is a strict liability mechanism, meaning once all three limbs are satisfied, the liability will only be defeated if one of the few statutory defences are utillised. They are:-

• Proving that the damage was wholly the fault of the Claimant (s5(1) of the 1971 Act).
• Voluntarily accepting the risk of damage (s5(2) of the 1971 Act)
• Trespass (if the dog is not kept there for the protection of persons or property or if so, keeping it there for that purpose was not unreasonable) of property (s5(3) of the 1971 Act)

Whiltst I do not intend to go into any detail on the above, it would sensible to point out that if the fault of the Claimant is only partial, then liability is not defeated because s10 and s11 allow for the Law Reform (Contributory Negligence) Act 1945 to apply.

The strongest case would be to demonstrate that the Claimant has failed to satisfy any or all limbs of the s2(2) test.

Conclusing remarks

This article only touches upon the 1971 Act in some very vague detail. The s2(2) is contradictory and complicated and there is significant wiggle room for interpretation thanks to the various Appellant decisions. Whilst broadly speaking the test can be relatively easy to explain, there is always grounds to consider whether or not the claimant has or can sufficiently established the necessarily elements for a strict liability claim.

Whilst dogs can easily satisfy s2(2)(a), it can be much more difficult to establish the remainder and it is of course on the Claimant to discharge the evidential burden.

I leave you with a very old photo (clearly shown by the fact that I have hair) with my dog when he was a little puppy!

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

Judicial conscience on the District Bench can quite often follow a reticent approach when it comes to deductions from a child’s personal injury damages. They see a child who has sustained injury as a result of another person or organisation’s negligence. Any reasonable person can see why there would be hesitancy in making such a direction, even where the litigation friend has consented. There can be some circumstances where there is no good reason but generally speaking, litigation is expensive and is not without risks.

Having worked on files that originated in a pre-Jackson universe, I am well-versed in After The Event (‘ATE’) insurance and its role in personal injury litigation, both pre- and post-Jackson reforms.

It has most certainly given me a better understanding as to why ATE premiums, that are no longer recoverable from the Defendant, ought to be deducted from the Claimant’s damages.

What is ATE insurance?

For those who do not know, ATE insurance is a policy that is tailored for litigation. Whilst many enjoy the benefits of, what is commonly referred to as Before The Event (‘BTE’) insurance through policies such as home insurance or credit credit benefits, many do not have access to such policies (or the policy does not cover the intened action).

Ultimately, if insurance doesn’t exist, the Conditional Fee Agreement (‘CFA’) system (introduced to cover the removal of legal aid in personal injury) cannot function, as CFAs will only protect the client against their liability for legal fees.; not the disbursements and any prospective third party fees.

CFAs would usually say somethign on the line of :-

If you lose, you do not pay our basic charges or success fee, but we will require you to pay our disbursements.

ATE insurance is not front-loaded. Therefore, a premium isn’t charged or payable from the outset. In fact, if the case were unsuccessful, the premium wouldn’t be charged at all, and it would pay out for the liability, finally protecting the client. However, if successful then the premium is charged.

Understandably, this meant that ATE Insurers would usually only insure cases where there was a good prospect of success. So how did this work in the pre- and post-Jackson world?

In the pre-Jackson personal injury world

Before the term ‘Qualified One-Way Cost Shifting’ was thrown around the PI world as both a sword and shield, personal injury cases just followed the usual cost consequences; costs follow the event, the Claimant would usually pay the Defendant’s costs up to the date of discontinuance and liabilities such as success fees and ATE premiums were recoverable from the Defendant.

ATE and BTE insurance policies were an absolute must. A Claimant couldn’t possibly risk proceeding with the risk. The cost of ATE premiums was high because they would have to cover not only the Claimant’s own disbursements but also the Defendant’s costs and disbursements. Given that the cases were primarily subject to standard costs, these costs could be high even on a fast-track matter.

Before the introduction of Legal Aid, Sentencing and Punishment of Offenders Act 2012 (‘LASPO’), the Claimant would be able to recover the ATE premium, providing the could demonstrate that they had exhausted all other options, such as BTE insurance policies.

An interesting side note, ATE insurers tended to require advice on liability to demonstrate that the prosepcts of success were sufficient to warrant indemnity by the ATE premium. In a way, it would vet cases to ensure those with good prospects proceed. However, the insurance industry was concerned about the cost of covering ATE premiums for cases (in addition to the standard costs).

Further, it was an important clause that the insurer was to be advised of any Part 36 offers received from the Defendant. If the insurer believed the Part 36 was too much of risk, they would end indemnity.

Then the 1st April 2013 arrived.

The post-Jackson personal injury world.

LASPO removes the recoverability of the ATE premium from the Defendant. The cost of the premium is now borne by a Claimant (or the litigation friend), but (subject to a finding of FD or another reason for the Court to disapply QOCS) the Defendant cannot recover any costs from the Claimant where the Claimant is unsuccessful.

In Jackson LJ’s opinion (as set out in his reports), the need for ATE would be practically eradicated thanks to QOCS (whilst recognising the need for protection from own disbursement liability). However, the actual reality is that QOCS merely controls the enforcement of a cost order. The moment that damages and costs are agreed or ordered by the Court¹, any Order to pay the Defendant’s costs becomes enforceable. Given that this would usually be set off against any liability to the Claimant, this would reduce the damages and costs recovered by the Claimant.

Having an ATE policy in a post-Jackson world is important regarding the liability of one’s own disbursments. However, it is also important to cover the Defendant’s cost liability where the Claimant’s damages or costs give rise to the Defendant’s costs becoming enforceable.

So how does ATE play a role in children cases?

Funding of claims for children

I was once asked, at an infant approval hearing in the context of seeking a deduction from the Claimant’s damages, if I was acting for the Solicitors or the Claimant. In my view, the advocate is technically acting for the Litigation Friend.

An individual is considered an adult at 18, and prior to that age, they are classified as a “child” and do not have the legal capacity to conduct proceedings. They cannot enter into a legally binding contract. So when one looks at the CFA, it is not with the Claimant, it is the Litigation Friend.

CPR 21.4(3)(c), which is titled ‘who may be a Litigant Friend without a court order’, says that where the child or protected party is a claimant, [the Litigation Friend may act as a Litigation Friend if they] undertake to pay any costs that the Claimant is Order to pay, subject to any right to be repaird from teh assests fo the child or protected party.”

What this tells us is that the Litigation Friend actually bears the financial responsibility of the claim being pursued, both for the Claimant’s own solicitors by virtue of the CFA, and the other party’s costs by virtue of CPR 21.4(3)(c).

So how can the Litigation Friend progress the Claimant’s claim on their behalf without exposing themselves to financial risk? With an ATE policy, which they take out because they are the ones who are financially responsible, even if the claim is on trust and for the benefit of the Claimant.

Can the Court refuse to allow the ATE policy?

The mechanism of CPR 21.10 is to protect the Claimant, along with the right to assessment of any costs under the Solicitors Act 1974. However, as identified in Herbert v HH Law Ltd [2019] EWCA Civ 527, an ATE premium is not a disbursement because it is a premium on a policy of insurance under which the client is the insured, pursuant to a contract of insurance made between the insurer and the client.

This is also confirmed by CPR 21.12(3), which says an expenses may include a premium in respect of a costs insurance policy (as defined by section 58C(5) of the Courts and Legal Services Act 1990).

As such, it is an expense that has been incurred by the Litigation Friend on behalf of a child and as per CPR 21.12(1), the Litigation Friend is entitled to recover the amoutn pay out of any money recoverd or paid into the Court on benefit of the Claimant to the extent that:-

• it has been reasonably incurred, and
• it is reasonable in amount.

So, how does one consider whether they were reasonably incurred?

CPR 21.12(5) says ‘in deciding whether the costs or expenses were reasonably incurred and reasonable in amount, the court will have regard to all the circumstances of the case including the factors set out in rule 44.4(3) and 46.9.‘

We then turn ot CPR 46.9:-

46.9

(1) This rule applies to every assessment of a solicitor’s bill to a client except a bill which is to be paid out of the Community Legal Service Fund under the Legal Aid Act 1988 or the Access to Justice Act 1999 or by the Lord Chancellor under Part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012.

(2) Section 74(3) of the Solicitors Act 1974 applies unless the solicitor and client have entered into a written agreement which expressly permits payment to the solicitor of an amount of costs greater than that which the client could have recovered from another party to the proceedings.

(3) Subject to paragraph (2), costs are to be assessed on the indemnity basis but are to be presumed –

(a) to have been reasonably incurred if they were incurred with the express or implied approval of the client;

(b) to be reasonable in amount if their amount was expressly or impliedly approved by the client;

(c) to have been unreasonably incurred if –

(i) they are of an unusual nature or amount; and

(ii) the solicitor did not tell the client that as a result the costs might not be recovered from the other party.

(4) Where the court is considering a percentage increase on the application of the client, the court will have regard to all the relevant factors as they reasonably appeared to the solicitor or counsel when the conditional fee agreement was entered into or varied.

Therefore, the expense is presumed to be reasonably incurred and reasonable in amount if approved by the client, either expressly or implicitly, unless they are unusual in nature or amount and the solicitors did not tell the Litigation Friend that the costs might not be recoverable from the third party.

Of course, the Court still needs to take CPR 44.4(3) into account:-

The court will also have regard to –

(a) the conduct of all the parties, including in particular –

(i) conduct before, as well as during, the proceedings; and

(ii) the efforts made, if any, before and during the proceedings in order to try to resolve the dispute;

(b) the amount or value of any money or property involved;

(c) the importance of the matter to all the parties;

(d) the particular complexity of the matter or the difficulty or novelty of the questions raised;

(e) the skill, effort, specialised knowledge and responsibility involved;

(f) the time spent on the case;

(g) the place where and the circumstances in which work or any part of it was done; and

(h) the receiving party’s last approved or agreed budget.

However, the ‘8 pillars of wisdom’ will be relevant to costs rather than expenses. So how can the Court tell if it is unusual in nature or amount? HHJ Monty KC gave some guidance in the County Court appeal of Duffield v WM Morrisons PLC [2025] EWCC 35.

Duffield v WM Morrisons PLC

HHJ Monty KC, sitting in the County Court at Central London, heard an appeal from DDJ Walton regarding the deduction of the cost of the ATE premium and success fee. This article will focus solely on the ATE premium element.

The DDJ had allowed some of the success fee, but refused the ATE premium in its entirety. The Judgment of the DDJ was short and given verbatim in the Circuit Judge’s judgment. The relevant sections of the DDJ’s judgment is as follows:-

6. In relation to the ATE premium, whilst an expense may include all or part of a premium in respect of a costs insurance policy, I do need to consider whether it was an expense that was reasonably incurred and reasonable in amount having regard to all the circumstances and the factors set out in CPR 44.4(3) and 46.9.

7. I am not persuaded that, in the circumstances of this case, it was reasonable to incur a premium of £675 in relation to a costs insurance policy. This issue is not with the amount of the premium but with the fact that it was incurred at all. Thiswas an accident that Brendan unfortunately suffered on the premises of Morrisons when he pulled a loose cabinet on to his foot. This is a personal injury case in which Qualified one-way cost shifting would apply. In the circumstances, it is difficult to see what, if any, risk could arise of the Claimant being required to pay the Defendant’s costs. The Claimant’s solicitors will have separately recovered an agreed amount of their costs from the Defendant. In addition, in a case such as this, it would be reasonable to expect that Morrisons would settle the case, which indeed they have.

8. So, any potential risk to the Claimant that might have been covered by a costs based insurance policy is not a risk that would, in the circumstances of this case, be one for which it would be reasonable to incur a premium for a costs based insurance policy. In the circumstances, there would be no reasonable expectation of the Claimant being at risk of paying the Claimant’s costs and it is therefore, difficult to see how such a deduction from the Claimant’s damages would have been reasonably incurred.

The Circuit Judge overturned the DDJ’s submission. He considered West v Stockport NHS Foundation Trust [2019] EWCA Civ 1220 para 56-57:-

• Disputes over the reasonableness and recoverability of ATE insurance premiums are not decided on a case-by-case basis. Instead, they are determined broadly by looking at general trends and the overall ATE insurance market, not by the specifics of individual cases.
• Reasonableness concerns extend beyond individual cases to include unavoidable features of the ATE insurance market.
• District judges and cost judges lack the expertise to judge the reasonableness of a premium except in very general terms. The ATE market could be harmed if they see themselves as better suited than the underwriter to assess the insurer’s financial risk without expert evidence.
• The paying party should raise a genuine issue about the reasonableness of the premium, which usually requires expert evidence to resolve.

The Circuit Judge found that refusing the ATE premium was wrong. The starting point was that allowing [part of] a success fee but rejecting ATE creates a contradiction, as both exist due to litigation risk. The Circuit Judge recognised that QOCS limits risk, but it not remove risk as damages can still be lost. ATE covers other risks, not just costs. You can’t judge an ATE reasonableness case-by-case based on claim simplicity, per the Court of Appeal decision of West. His conclusion was that the DDJ wrongly relied on hindsight, ignoring the time when insurance was taken out.

Concluding thoughts

The understandable knee-jerk reaction to anyone reasonable would be “why on earth would I endorse the reduction of this child’s damages?” The inevitable truth is litigation is expensive, and a Litigation Friend will conduct a child’s claim for no financial gain and with the financial risk.

QOCS can only protect a Claimant to an extent in terms of third-party liability when there is no enforceability (damages or costs awarded or agreed), and most certainly not their own liability to disbursements. In my time as a self-employed CILEX Advocate, I acted for various law firms on infant approvals, and I saw the range of ‘paper-based’ submissions they made to justify the deductions.

The starting point is that the ATE policy was reasonably required in a reasonable amount unless it appears unusual in nature or amount, or the Litigation Friend was not advised it would be unrecoverable in amount. I would say there has to be a very compelling reason why an ATE policy was unusual, and without expert evidence, the Court cannot be in a position to find that the ATE premium was unusual in amount.

So, to answer the question of why the ATE premium should be deducted from the child’s damages, one has to remember that ultimately the Litigation Friend is incurring the time, the expense and the financial risk for absolutely none of the reward. The child would have no damages but for the efforts of the Litigation Friend. Save for CPR 46.9(3)(c), there should be no good reason to refuse the deduction from damages to pay for the ATE premium.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

1. It is important to note that cases issued before 6th April 2023 would have been subject to the old version of QOCS, which limited enforcement only to the damages that the Court had agreed. ↩︎

Disclosure is an important stage of litigation, and sometimes parties can be prohibited by the fact that the disclosure they need or ought to obtain and disclose is not within their physical possession but held by a third party.

I remember in my litigation days that when you sued a tour operator regarding an accident or illness at a hotel abroad, the tour operator would metaphorically shrug when you sought disclosure of certain documents, as the records were held at the hotel abroad and were not the tour operator’s documents. However, it was not always as simple as that.

This article considers this issue in more detail.

To what extent can a litigant be responsible for acquiring documents held by third parties?

CPR 3.8 says the following:-

(1) A party’s duty to disclose documents is limited to documents which are or have been in his control.

(2) For this purpose a party has or has had a document in his control if –

(a) it is or was in his physical possession;

(b) he has or has had a right to possession of it; or

(c) he has or has had a right to inspect or take copies of it.

It is really easy for a party to know what is within its physical possession.  The question is to what extent is the right to possess and the right to inspect and take copies of it. A straightforward example is a person’s medical records. A Claimant would be entitled to both the right to possess, inspect or take copies of it.  

What about bank statements? The same principle would apply as it would to medical records, you have a right to your own bank statements. However, what happens if the spouse of the Claimant potentially has bank statements that could influence the case? That was a point considered by Knowles J in the High Court appeal of Morgan-Rowe v Woodgate [2023] ALL ER (D) 02 (Oct).

The first instance decision was considered by a Recorder who determined that liability should be at 50% due to the Claimant’s contributory negligence, but the real battleground was the credit hire being claimed by the Claimant. The Recorder found that the Claimant was impecunious based on the financial evidence given by the Claimant and relied on in support of the assertion that she was impecunious.

The Defendant appealed to the High Court because they were of the view (amongst other arguments on the issue) that the claimant had failed to disclose all financial records and therefore should be barred from being able to rely on impecuniosity. The argument centred on bank accounts believed to belong to the Claimant’s husband, revealed indirectly through a transaction on a joint HSBC account. The Defendant argued that there must have been other accounts and credit cards, that these statements should have been disclosed, and that failure to do so meant the Claimant should be considered poor.

The Recorder had found that the accounts in question were in the husband’s sole name and when considering CPR 31.8, could not make the finding that there was a failure to disclose. 

Knowles J did not disturb the Recorder’s findings. He said there was no evidence that the Claimant possessed her husband’s bank statements, had any legal right to them, or had the right to inspect or copy them, meaning none of the requirements of CPR 31.8(2) were met. Knowles J explained that a married couple with separate bank accounts do not automatically control each other’s financial records. Therefore, the husband’s statements were not within the claimant’s control, were not part of standard disclosure, and there was no breach of the disclosure order.

Is the right to possession, inspect or take copies a straightforward question?

No, it is not. Courts don’t apply CPR 31.8 only to whether there’s a strict legal right. They look at the true relationship between the litigant and the third party with the documents. Even if there’s no formal legal right to possess them, documents may still be considered within a party’s control if the relationship suggests they can access them.

In the case of North Shore Ventures Limited v Anstead Holdings Inc [2012] ALL ER (D) 89 (Jan) the Claimant had a US$35 million after securing a Judgment against the Defendants. After the judgment, the Defendants put assets into family trusts, where they and their families were beneficiaries. The Claimant suspected the trusts were used to hide assets and prevent enforcement. It asked for a Court order to see trust documents, even though the trustees held them. The Defendants claimed they did not have the documents and had no legal right to access them, so they were not in their “control” under CPR 31.8. The Defendants appealed the order.

The Court of Appeal was asked to consider whether documents held by third-party trustees could nevertheless be treated as being in the Defendants’ “control” for the purposes of CPR 31.8. The Court of Appeal dismissed the appeal.

They confirmed that CPR 31.8 is not limited to strict legal rights. When documents are held by a third party, the Court looks at the true relationship between the litigant and the holder. Even without a legal right, documents may still be under a party’s control if, in practice, the third party acts on their instructions or there’s an understanding that documents will be provided on request.

The Court said it can find documents within a party’s control based on the situation, not just law. In this case, the Judge believed the trusts were set up to protect assets and that the trustees weren’t acting independently. They followed the defendants’ requests. This meant the documents held by the trustees were considered controlled by the defendants because they created the trusts, their families benefit, and the setup looked like an attempt to avoid enforcement. The court inferred strong practical control.

A document can be in a party’s control if they can realistically get it, the holder usually acts on their wishes, or there’s an informal understanding for access. A strict legal right is not necessary.

This Contrasts with Morgan-Rowe, where the court found that the husband’s bank accounts were genuinely independent and there was no evidence of control. Whereas in North Shore the trustees followed the Defendants’ instructions. 

Third parties and third-party applications. 

In Morgan-Rowe, the Recorder highlighted that it was open to the Defendant to make a third-party application under CPR 31.17. The test is substantially higher than that for a pre-action disclosure application. Under CPR 31.17 the applicant must show:-

• That the documents are likely to either support or adversely affected the case, and
• It must be necessary to fairly dispose of the claim or safe costs

Once the applicant gets over that high threshold, the Court then has the discretion to balance the factors to consider whether to exercise its power to order a third party who is not a part of the proceedings to disclose.  

Further, as with PAD applications, the presumption is the applicant will pay the Third Party’s costs of complying with the Order and the application itself (although, as per CPR 46.1, the Court can consider making a different Order when considering the reasonableness of opposing the application).

In April 2026, CPR 31 is going to be amended to include the following:-

31.12A.  The court may order a party to request any person to produce for disclosure and inspection any document which may support the case or adversely affect the case of any party to the proceedings

This will not force a third party to disclose documents, but it ensures that parties have asked third parties for relevant documents. I am uncertain whether this would require a party to sign a statement of truth explaining their efforts to obtain the evidence or whether it would significantly affect the likelihood of a third-party disclosure application and the 31.17.

Concluding remarks.

Disclosure held by a third party is not a new principle. It’s been relevant for many years and the mechanisms have been widely available to parties where it is necessary. However, it doesn’t always mean it can be utilised.

Even if Knowles J found that CPR 31.8 could mean the Claimant had failed to comply with the credit hire debaring Order in Morgan-Rowe, would that mean that a spouse’s financial position is relevant to determining whether or not the Claimant was impecunious?

Third-party disclosure is a useful but controlled tool. The Courts won’t allow wide-ranging searches (amounting to fishing expeditions) but will intervene if outside documents are genuinely needed to resolve issues.

Whether through CPR 31.17 applications or by viewing documents as within a party’s control under CPR 31.8, the emphasis will be on substance over form. Who actually has the evidence and who can access it? Practitioners should define requests only when the evidence is necessary and be ready to explain who owns the documents.

Whether CPR 31.12A’s introduction in April will assist this issue on standard disclosure is something that practitioners will no doubt find out.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

A personal injury practitioner is often instructed by someone injured in a public location, not on a highway, but on premises that are open to the public. It is well known that the relevant law imposing a duty of care to keep lawful visitors reasonably safe on such premises is the Occupiers’ Liability Act 1957 (with the Occupiers’ Liability Act 1984 increasing the scope to trespassers in certain circumstances).

Whilst the 1957 Act (which came into force on the 1st January 1958) has some additional scope for those who are children and are present in the exercise of their calling, the duty is reasonably fair, clear and reduced to a single concept of visitor.

However, if pleadings were to omit the 1957 Act, then the landscape would be wholly different. Instead of a common duty of care, the occupier would owe different duties of care to different individuals. In essence, the Court would be in a position to consider negligence occurring in the 21^st century, contrary to Victorian case law. 

Prior to the 1957 Act, there were generally three types of visitor:-

• Invitee
• Licensee
• Trespasser

For ease, I will use the term ‘Claimant’ even though in the cases below, they would be referred to as the ‘Plaintiff’.

Invitee v licensee

Pearson v Lambeth [1950] 2 K.B 366 is a case where a person was deemed to be a licensee. The Claimant used a public toilet provided by Lambeth Borough Council, accessible via steps between two walls. At night, a sliding metal grille was pulled across and locked, but during the day it was pushed back and could not be locked open. While inside, children known to swing on the grille pulled it partly forward. When the claimant returned up the steps, he hit his head on the metal hasp hanging from the grille and was injured.

The trial judge dismissed the claim, finding that the Claimant was a licensee and that the council had no knowledge of the specific danger, so it did not breach its duty of care.

The Court of Appeal allowed the appeal because whilst they found the Claimant to be a licensee, they say that the Council had sufficient knowledge of the risk created by third party interference (i.e., children who regularly tampered with the grille, which made it capable of becoming dangerous). 

With regard to finding that the Claimant was a licensee, the Court of Appeal said the following:-

This conclusion, if well founded, would absolve us from considering the other issue, namely, whether the plaintiff was indeed a mere licensee or an invitee. If we are wrong, and the plaintiff was an invitee, he would in this character a fortiori be entitled to recover. But, as the issue has been argued before us at some length, we think that we should set out briefly the grounds of our conclusion that the plaintiff was a licensee only. The general principles on which persons coming on the premises of an occupier with his consent are classified as invitees and licensees, respectively, are easy to formulate, but not always easy to apply. They are somewhat over-simplified in the formula in Salmond’s Law of Tort 10 th ed., at p. 476 justly commended by MacKinnon L.J. : ” The invitor says ‘ I ask you to enter upon my business.’ The licensor says ‘ I permit you to enter on your own business ‘.”

Succinct and vivid as is this formula is, it might suggest that the visitor is an invitee only if the business on which he comes is exclusively that of the occupier. This is, of course, not what is meant. It is more exact to say that an invitee is a person who comes on the occupier’s premises with his consent on business in which the occupier and he have a common interest; e.g., a shopper has an interest to buy and a shopkeeper an interest to sell. It is sometimes said that the interest must be pecuniary or at least ” material.” This certainly does not mean that a visitor who is not required to pay and does not pay is necessarily excluded from the class of invitees : e.g., many shops encourage customers to enter and inspect their wares without any obligation to buy.

The Court of Appeal found that using the public toilet was in keeping with a licensee, but found the Claimant was still entitled to damages because, in these circumstances, the Defendant had actual knowledge of the potential danger because they knew of the probability of children being pulled and moved by children. They didn’t need to know or foresee the precise manner in which the danger would translate into an actual casualty.

An invitee would be owed a higher duty of care to be safe from harm.

In the case of Stowell v The Railway Executive [1949] 2 K. B. 519, the Claimant went to Paddington Station to meet his daughter and help with her luggage. As he walked along Platform 9, he slipped on oil or grease and was hurt. Earlier that day, a fish train had arrived, and fish boxes often leaked water, slime, and oil. Staff were supposed to clean and sand the platform after deliveries. Evidence showed oil was still there, and staff had enough time to see and clean it.

The High Court needed to consider whether the Claimant was an invitee or a licensee. They were able to find that the Claimant was an invitee because the railway promoted people entering the platforms to meet arriving passengers. Assisting passengers with luggage helped both the passengers and the railway, as it sped up clearing the platform. Thus, the Claimant was present on the premises for a purpose that shared a business interest with the Defendant.

The duty of care to an invitee was to protect them from unusual dangers they knew or ought to have known about. The unusual danger was to be judged by the perspective of the particular invitee, and people on busy platforms are entitled to expect the surface to be safe and are not required to watch every step. Therefore, the Defendant was negligent as they knew or ought to have known about the oily patch. The Defendant’s staff failed to remove it or make it safe, and this was the cause of the Claimant’s accident.

The shared business interest point could become problematic. Could a door-to-door salesman walk through a garden to a front door and claim a shared business interest? If so, was that status lost when the householder refused the salesman?

Dunster v Abbott [1954] 1 WLR 58 (CA)

This is a case where the Claimant was an advertising canvasser who visited the Defendant’s house hoping to sell advertising space. The Defendant was not interested and escorted the claimant out along a dark driveway and over a small concrete bridge crossing a ditch.

After estimating that the Claimant had reached the road, the Defendant switched off a garage light, but the Claimant was still on the bridge. Believing he was on the pavement, he turned right, tripped, fell into the ditch, and was injured. Initially, the Claimant was treated as an invitee and awarded damages, though with a reduction for contributory negligence. The Defendant appealed.

The Court of Appeal allowed the appeal and dismissed the Claimant’s cross appeal. It was determined that the Claimant was only a licensee, rather than an invitee, because an invitee must be attending on business in which both parties have a common interest and in this circumstance, the Claimant was attending on his business only, for which the Defendant had no interest in.

This is where Lord Justice Denning made the following observation:-

A canvasser who comes without your consent is a trespasser. Once he has your consent, he is a licensee. Not until you do business with him is he an invitee. Even when you have done business with him it seems rather strange that your duty to him should be different when he comes up to the door than when he goes away. Does he really change his colour in the middle of the conversation? And what is the position when you discuss business with him and it comes to nothing? No confident answer can be given to these questions. Such is the morass into which the law has floundered in trying to distinguish between licensees and invitees.

In the present case the canvasser came to the door, the householder asked him in, the canvasser stated his business; the householder was not interested, and the canvasser left. Upon those facts I am clearly of opinion that the canvasser was not an invitee but only a licensee, because he was there on his own business and not on any matter in which the householder had an interest. We all know that a guest whom the householder invites to dinner is only a licensee, even though the householder has an ulterior business motive in asking him. It would be strange if a householder owed a higher duty to a canvasser who comes unasked than he does to a guest who comes on his express invitation.

Ultimately, being a licensee meant the Defendant had only a duty to warn the Claimant of concealed or unusual dangers of which he was aware. The Licensee must take the premises as they find them in all of circumstances. Even as an invitee, the Court of Appeal found that the Defendant was not negligent, but this case shows the dangerous of having different levels of duty of care depending on the type of visitor you are.

What about trespassers?

In the case of R Addie & Sons (Collieries) Ltd v Dumbreck [1929] ALL ER Rep 1, the Defendants owned a colliery field with dangerous haulage equipment, including a horizontally exposed wheel connected to a cable used for transporting ashes. The poorly fenced field, with large gaps in the hedge, was accessible to children from nearby houses, and despite warnings from employees, children frequently entered it, mistaking the machinery for an attractively dangerous play area.

Tragically, a small child was fatally injured when he wandered into the field, approached the active wheel, and was caught. The child’s father sued the owners, alleging negligence for failing to adequately fence or guard the machinery to prevent such access.The House of Lords allowed an appeal by the Defendants. They found that the child was a trespasser because there was no permission for children to enter the field, and despite knowing about the trespassing, the Defendants had only warned them without encouraging or tolerating their presence.

The House of Lords confirmed that an occupier has no duty to a trespasser unless there is deliberate harm or reckless conduct, and in this case, the defendants were only negligent without malicious intent.The House of Lords rejected the proposition of a higher duty toward child trespassers. Despite the dangerous and attractive machinery, knowing that children often entered the field did not change the legal position. Age was irrelevant once classified as a trespasser. They found that occupiers were not required to fence against the world, and that failing to do so does not turn trespassers into licensees or create liability.

Consideration

The duty of care introduced by the Occupiers’ Liability Act 1957 marked a meaningful change from the old, often inconsistent common law rules. Before the 1957 Act, liability was largely based on the type of visitor you were, with different protections that could lead to confusion, including whether you substantially changed from one type of visitor to another during a visit to the occupiers’ premises. 

The 1957 Act eliminated the invitee/licensee distinction and established a single statutory duty for all lawful visitors, making sure occupiers take reasonable steps to keep them safe. 

However, the warning is this. If those who draft proceedings fail to include reliance on the 1957 Act and plead the allegation that the Defendant had failed to breach s2 of the 1957 Act, then the Claimant risks the Court having to consider the duty of care owed by the Defendant under the stricter common law duty. 

After all, all recent case law is considering the application of the 1957 Act after it had been pleaded and relied on by the Claimant.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

Whether you are a litigator or an advocate in civil proceedings, Part 36 plays a pivotal role and, if utilised correctly, can bring a matter to a reasonably amicable conclusion. The difficulty is that if not used in an appropriate manner, it will quite often lose its bite (such as making an unrealistic offer or making it far too late).

Quantum offers are often utilised more than liability offers, with the latter being the subject of Mundy v TUI UK Limited [2023] EWHC 385 (Ch), casting doubt on whether liability offers are even worth making.  However, the Court of Appeal in Smithstone v Tranmoor Primary School [2026] EWCA Civ 13 has overturned the controversial High Court decision of Colins Rice J.

Under CPR 36.2(3), a Part 36 offer can relate to the whole claim, part of the claim, or any issue within the claim. A liability-only offer is usually an agreement to settle the liability aspect at a certain percentage, such as 90% in favour of the claimant, with quantum to be decided later. The probative value of making such an offer is evident: acceptance resolves liability, narrows the issues and dispute, and saves time and costs. Strategically, rejecting such an offer can also lead to increased costs under CPR 36.17 if the offeror later achieves a better result. Punitive, but also proactive in encouraging settlement. 

So how could an offer that would reduce the issues, costs and court resources be deemed not to trigger the Part 36 consequences? 

Mundy v TUI UK Limited

Mundy was an appeal against a first instance decision where the Claimant successfully established his cyclospora infection was contracted from the food at his hotel, which was provided for under an all-inclusive contract from his tour operator.  The Claimant had made a £20,000 Part 36 offer to settle but also a liability-only Part 36 in the sum of 90/10% in his favour. He ended up being awarded around £200 less than the Defendant’s Part 36 offer of £4,000. 

The Claimant appealed to the High Court on the basis that he should not be ordered to pay the Defendant’s costs from the expiration of the £4,000 to trial because he had beaten his 90/10% Part 36.

Upon dismissing the appeal, Collins Rice J expressed concern towards 90/10% liability offers and their role. She concluded that such an offer did not constitute an offer to settle the claim or a measurable part of it, and its value could not be meaningfully separated from the eventual damages award.

 The court explained that CPR 36.17 primarily deals with comparing offers and judgments “in money terms,” but in cases where liability is binary, an offer based solely on liability does not lend itself well to such comparisons. Relying on having “beaten” a liability-only offer could undermine the structured and predictable framework of Part 36. Consequently, she found that the Claimant could not rely on CPR 36.17(4) solely because liability was established at trial. While the 90/10 offer might influence the Court’s discretion on costs, it should not automatically trigger Part 36 benefits. 

For some time, litigators contemplated whether liability only trial had any merit. Until the Court of Appeal considered the same issue in Smithstone.

Smithstone v Tranmoor Primary School

In Smithstone, a ten-year-old injured his fingers when they got caught in a door at the Defendant’s School. He filed a personal injury claim for negligence and breach of the Occupiers’ Liability Act 1957.

The claim proceeded under the low-value fixed costs regime. Before any medical evidence was provided, the Claimant made a Part 36 offer to settle for 90/10% liability in his favour. The school rejected this offer and denied liability. However, the parties settled for a sum of money and went to an approval hearing. The Court approved the settlement and ordered the Defendant to pay the Claimant’s fixed costs. The Claimant appealed, arguing that the liability-only offer displaced the fixed-cost regime (because Part 36 costs in the pre-1^st October 2023 regime were assessed on an indemnity basis).

The Court of Appeal dismissed the appeal because liability had not been determined and therefore the Claimant could not demonstrate that the settlement was at least advantageous as the 90/10% liability Part 36 offer. 

What was important, however, was the consideration of Mundy:-

34 …… But insofar as Collins-Rice J may have suggested (obiter) that a 90:10 liability offer is ineffective as a matter of principle to engage CPR 36.17, I disagree. Whether litigation is complex and of high value, or straightforward and of relatively modest value, the Courts should, and the Civil Procedure Rules do, encourage settlement of specific issues where the case as a whole cannot be settled. In a case where liability is to be tried before quantum the benefits of a liability-only offer in saving costs and court time are obvious.

But even in a fast-track case where all contested issues will be resolved by a district judge or deputy district judge in the course of a single hearing, liability-only or quantum-only offers are still to be encouraged. The policy considerations identified in Huck v Robson and Broadhurst v Tan remain to this day. The 90/10% offer was, in my view, to be treated as a genuine offer to compromise, just as the 95/5% offer was treated in Huck v Robson.

35 Accordingly, while Judge Baddeley understandably regarded Mundy v Tui as binding on him, I would overrule it on the issue of principle. That is not, however, enough to get the Claimant home, since the next issue is whether on the facts of this case the outcome was at least as advantageous to the Claimant as the proposals contained in his offer.

Broadhurst v Tan [2016] EWCA Civ 94, which was significant for pre-1st October 2023 cases because it established that the cost consequences of Part 36 should consider the actual costs incurred and be assessed on an indemnity basis. It also looked at Huck v Robson [2002] EWCA Civ 398, where a 95/5% split was found effective when 100% liability was proven, demonstrating that Part 36 was not limited solely to global monetary offers.

Concluding thoughts

Overall, liability-only Part 36 offers are valid and do not automatically exclude Part 36 consequences. In my view, Smithstone was unlikely to succeed because there must be a judgment that beats a Part 36, and court approval of a settlement is not the same as the court making a ruling after hearing all evidence at trial. Additionally, the Court retains the discretion not to award cost consequences if it believes doing so would be unjust. Litigators should keep this in mind when proposing Part 36 offers. If you cannot demonstrate that realistically how the agreement to liability would have likely led to a settlement of quantum as well, then there would be grounds for the other party to argue that it would be unjust to do so.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

I’m spending my Sunday morning watching the final Mission Impossible movie, which includes many clips from earlier films, including the very first from 1996 when I was eight.

One of the most prominent pieces of technology shown from the first Mission Impossible film (aside from the latex face mask) was glasses with a built-in camera, which played a crucial role in the plot (I won’t spoil why). I recall thinking how amazing it would be to have tiny cameras that could be integrated into everyday objects, so discreetly that no one would know.

Roll forward thirty years and we legitmiate glasses from manufacturers (such as Ray Ban) which, amongst other features, have a built-in camera. It’s incredible, but it does make me wonder how susceptible Courts will be to court users who could now be wearing recording equipment in everyday wear, such as glasses.

The Legal Prohibition on Courtroom Photography

The Courts of England and Wales are still subject to s41 Criminal Justice Act 1925, which makes it unlawful to take or attempt to take any photograph, or to make a sketch for publication, of judges, jurors, witnesses, or parties to proceedings in court. Many believe that taking any photographs within Court can amount to a breach of s41:-

41 Prohibition on taking photographs, &c., in court.

(1)No person shall—

(a)take or attempt to take in any court any photograph, or with a view to publication make or attempt to make in any court any portrait or sketch, of any person, being a judge of the court or a juror or a witness in or a party to any proceedings before the court, whether civil or criminal; or

b)publish any photograph, portrait or sketch taken or made in contravention of the foregoing provisions of this section or any reproduction thereof;

and if any person acts in contravention of this section he shall, on summary conviction, be liable in respect of each offence to a fine not exceeding fifty pounds.

(1A)See section 32 of the Crime and Courts Act 2013 for power to provide for exceptions.

(a)the expression “court” means any court of justice (including the court of a coroner), apart from the Supreme Court;

(b)the expression “Judge” includes . . ., registrar, magistrate, justice and coroner:

(c)a photograph, portrait or sketch shall be deemed to be a photograph, portrait or sketch taken or made in court if it is taken or made in the court–room or in the building or in the precincts of the building in which the court is held, or if it is a photograph, portrait or sketch taken or made of the person while he is entering or leaving the court–room or any such building or precincts as aforesaid.

I previously wrote an article discussing how some interpret s41(1) as prohibiting taking photographs in courts and also forbidding a portrait or sketch of anyone involved in court proceedings for publication. Others see the restriction as applying to any photograph, portrait, or sketch of any person connected to the court proceedings.

Realistically, the safe approach is not to take photographs. However, there can be circumstances where a photograph is not a photograph in the conventional sense, but a scan of a document with a phone, immediately creating a PDF copy of the document. Would that amount to take a photograph? If one were to take the approach that photographs in court and sketch/portraits of people in court are two separate actions that are subject to s41, scanning a document in Court has the possibility of being a breach of s41.

Example – HM Solicitor General v Cox & Parker-Stokes [2016] EWHC 1241 (QB)

The Queen’s Bench Division considered whether secretly taking photographs in court and posting them on social media could amount to contempt of court.

The case came from a murder sentencing at Bristol Crown Court. Two friends of the offender used their phones in court to take pictures; one photographed the Defendant in the dock, and the other photographed the judge. Some of the images even showed Court signs warning about the prohibition of cameras. After the hearing, the photos were posted on Facebook, where they were seen by many and drew various comments. Members of the victim’s family later saw the posts, which caused them serious upset and they advised the police.

The Solicitor General brought contempt proceedings against the two individuals, rather than relying on a breach of s41 of the 1925 Act, because that was a summary conviction with a level 3 fine.  It was the contention of the Solicitor General that the gravity of the conduct was the ‘wilful defiance and affront to the authority of the court’. 

The High Court allowed the application for contempt. There was a specific act intended to prevent a photograph from being taken. The immediate impact can be a distraction to proceedings, including witnesses, jurors, parties, and Court staff. S41 of the 1925 Act was clearly intended to prevent this immediate impact. The Court then considered that more damage can be caused by sharing or publishing the photographs. The impact can then be more widespread, affecting more than just the hearing itself, such as impacting the victims, their families and undermining the authority of the court, essentially impacting the public’s confidence in the justice system.

Further, the Court made it clear that specific conduct of sharing the photographs goes beyond the statutory offence of s41 because whilst s41 was useful in giving the court the immediate power to deal with anyone seen taking photographs in court in order to ensure it maintained control over the proceedings, the later steps of sharing the photographs (whilst not in the face of the court) was contempt and could interfere with any subsequent hearings, appeals and so forth. 

Discussion

As cameras become increasingly embedded in everyday technology, from phones to glasses, and the increase of apps utilising the camera, such as document-scanning apps, the boundary between ordinary, innocent use and unlawful conduct is becoming harder to see when at Court.

A rather innocent act, such as taking a photograph of a document at Court, could in fact fall within the scope of s41 of the 1925 Act. The varied interpretations could mean that a breach does not require a relevant person (Judge, juror, witness or party) to be within the photograph.

Although the consequences of a breach of s41 are relatively limited when compared with the potentially severe sanctions for contempt of court, being a summary offence punishable by no more than a level 3 fine, currently capped at £1,000 per offence, it’s still an offence and should not be taken lightly.

Undoubtedly, individuals who take and share photographs, whether intentionally or not, such as on social media, face the risk of contempt charges. Practically, I suggest court professionals avoid photographing documents altogether and reduce the chance of accidental violations of s41 by sharing documents via email or secure short-range wireless methods like Apple AirDrop.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

The European Communities (Rights against Insurers) Regulations 2002 can simplify the enforcement steps needed in an RTA matter. It can also reduce issues when it comes to service, because the claim can be served against the insurer when Solicitors have not been nominated (or, if they are a limited company, even when Solicitors have been nominated as per Collier v WIlliams [2006] EWCA Civ 20).

However, it still requires the driver to be identified, as Regulation 3 of the 2002 Regulations takes effect because the Claimant would have a cause of action against the insured driver. If you do not know the identity of the driver, how can you know if the Defendant insurer would be liable to indemnify the collision? That was the determination of the Supreme Court in Cameron v Liverpool Victoria Insurance Co Ltd [2019] UKSC 6.

Cameron v LV

On 26^th May 2013, Ms Bianca Cameron was injured in a road traffic collision in Leeds involving a Nissan Micra. The collision was caused by the Micra’s driver, who drove away and was never identified. The Micra was registered to Mr Naveed Hussain, but he was not driving at the time. He later refused to identify the driver and was convicted of failing to do so.

The car was insured with Liverpool Victoria Insurance Company Ltd (LV), but the policy was taken out in the name of “Mr Nissar Bahadur,” who was believed to be fictitious. Neither the registered keeper nor the driver was insured to drive the car. Ms Cameron obtained the registered keeper’s details and initially brought the claim against them, with LV as a second Defendant to satisfy any judgment against the registered keeper under section 151 of the Road Traffic Act 1988. When it became clear that the registered keeper was not the driver, Ms Cameron applied to amend her Particulars of Claim to say  “ the unknown driver of…”.

In the first instance and at the Court of Appeal, the Claimant prevailed on this point. However, the Supreme Court overturned the decision and found in favour of the Defendant. The Supreme Court held that a basic principle of justice is that no person can be made subject to the court’s jurisdiction unless they have notice of the proceedings sufficient to enable them to take part. It follows that a claim cannot properly be issued or amended against an unnamed defendant where it is conceptually impossible to bring the proceedings to that person’s attention.

They found that proceedings can only be brought to a Defendant insurer’s attention if the Defendant is described in the claim form in a way that makes it possible, in principle, to locate or communicate with them and to identify whether a particular person is the one being sued.

In this case, the description of the driver was based solely on a past act and did not make it possible to locate or identify him. As a result, the driver could not, as a matter of English law, be sued under that description. Alternatively, the claim would have otherwise been brought against the MIB under the untraced driver’s agreement.

Recent example

I was recently instructed in a matter which was proceeding to trial and the Defendant had denied purely on the basis that the Claimant had not identified the driver and therefore the claim against the Defendant insurer was defective. It did not deal with the accident or the heads of loss (including credit hire).

Upon reviewing the Particulars of Claim I noted the pleadings said “the Defendants insured was the driver of “, which was very vague. I then considered the bundle and came across correspondence which included one email from the Defendant Insurer saying”-

Thank you for your recent communication. Please note our interest as Motor Insurers of [name redacted].

Having reviewed the circumstances of this incident, we will not be disputing liability.

I also noted a subsequent email:-

Thank you for your e-mail.

We are indemnifying our insured, we will be listed as 1st defendant. You may intimate proceedings against [Defendant insurer name and address redacted].

It was going to be my contention that the correspondence, the naming of the insured and confirming the identity meant that both parties were quite aware of who the insured driver was and therefore was distinguishable from Cameron. I prepared a skeleton argument and my opponent, upon my arrival to Court, sent a copy of her skeleton to me. Before I read it, we were asked (advocates only) to appear before the Judge.

Amongst other points (put to both myself and my opponent), the Judge asked my opponent about correspondence containing an admission, the apparent identity of the insured, and confirmation that indemnity was not an issue. My opponent said she would argue that it was not an admission that the insured person was the driver. The Judge advised that even if the issues did get resolved in favour of the Claimant, it was unlikely we would be able to have the trial heard as well. He indicated that this might be a case where we should step outside and exhaust all negotiations before reverting to make submissions.

In the end, the parties reached a compromise. The Judge indicated that it would have been an interesting issue but gave no indication of his preliminary view.

Conclusion

In essence, whilst my submissions may very well have had some traction, it was a real risk that the Claimant had not named the driver (or who he believed the driver was). If the Claimant had named the insured, and the Defendant then decided to challenged that the insured was the driver, then it could be address accordingly.

My backup approach would have been to argue that as, per In Soo Kim v Youg [2011] EWHC 1781 (QB) and Alton v Powszechny Zaklad Ubezpieczen [2024] EWCA Civ 1435, this was the first time the issue was being addressed by the Court and that a remedy should be allowed before the draconian step of a strike out. The Defendant did not make an application to strike out and was silent on the point at the allocation hearing. Any prejudice to the Defendant would have been remedied by the Defendant having the opportunity to plead a positive case against the Claimant. However, on the other hand, the Claimant had not taken any steps to remedy their case upon receipt of the Defence.

Whilst Cameron was an issue regarding the principle of the insurer being a named Defendant for the purposes of s151 Road Traffic Act 1988, the principle does apply to the 2002 Regulations as it is clear from Regulation 3 that it concerns an insured person, not a vehicle. You can’t compel an insurer to insure a person that they may or may not insure.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.

I wasn’t going to write an article about this. I had my views about the interpretation of sch 3 Legal Services Act 2007 when I read the reserved decision of Vehicle Control Services Ltd v Langley [2026] EWCC, sitting in the County Court at Haverfordwest. However, I have had a few people contact me about it.

In particular, I focus on the points raised about Schedule 3 par 1 (7)(a) and (b). I do not comment on para 1(7)(c) regarding whether the matter is in chambers. This article also does not concern qualified advocates, advocates who come under the definition of a lawyer who can represent a party at a small claims trial as per PD27A para 3.1 or under the Lay Representatives (Right of Audience) Order 1999 – none of these were considered in the Judgment.

DJ Pratt was of the view that the advocate did not meet the criteria for Sch 3 Legal Services Act 2007 because they did not meet the following criteria:-

1. (7)(a) – the person is an individual whose work includes assisting in the conduct of litigation. 
2. (7)(b) – the person is assisting in the conduct of litigation –
3. Under instruction given (either generally or in relation ot the proceedings) by an individual to whom sub-paragraph (8) applies and
4. Under the supervision of that individual

DJ Pratt found that the small claim trial would take place in chambers. I don’t intend to address that point. 

The person is an individual whose work includes assisting in the conduct of litigation 

DJ Pratt says, at paragraph 11 of his judgment, that the definition of litigation to be found in paragraph 2 of schedule 2 to the Act as “‘…the issuing of proceedings…the commencement, prosecution and defence of such proceedings, and…the performance of any ancillary functions in relation to such proceedings (such as entering appearances to actions).’

He then says the following:-

42. Vehicle Control Services’ in house team and DCB Legal have solely taken all the steps in the litigation. Elms Advocacy Agency Limited have only acted as an advocacy agency sub-subcontracting to Mr Boaten. They have taken no step recognisable as ‘litigation’. It is clear that Mr Boaten has no connection to the Vehicle Control Services. Neither he nor the advocacy agency have undertaken any step in the litigation save attend on an advocacy only basis. Neither Mr Boaten nor the agency have written any letters, signed any documents, issued any proceedings, or taken any other steps in the litigation. Advocacy alone cannot be conducting litigation.

43. I find that Mr Boaten has not been assisting in the conduct of litigation. Mr Boaten’s claim to be an Exempt Person must fail at this first hurdle. Nevertheless, for completeness I will consider the other conditions.

Let us take Elms out of the equation for now. Let us imagine that at Haverfordwest, we did not have an advocate from Elms but an in-house paralegal from DCB Legal.  The paralegal walks in and sits down, ready to present the case on behalf of VCS. DJ Pratt looks up and invites the paralegal to explain their right to appear. 

DJ Pratt says neither Elms nor the advocate had written letters, signed any documents, issued any proceedings or any steps in the litigation. Is DJ Pratt saying that a paralegal at DCB who hasn’t done any work on the file cannot attend on behalf of the client even if they are being supervised? Are they expected to provide evidence to support that they have done work? Then comes the big question. DJ Pratt gives examples of what they could have amounted to assisting in litigation, but given Mazur, isn’t it more likely that those steps could have amounted to litigation?

I think that DJ Pratt has, as HHJ Backhouse suggested in Halborg v Apple, applied the definition in an incredibly narrow manner.

In my view, it cannot be limited to only individuals who have physically assisted in some way shape or form with the litigation. It would be perverse that an employee of the solicitors’ firm on record for the party would be under supervision for attending the hearing, but having not done any work at all on the file was deemed not to be assisting in the course of litigation.

DJ Pratt emphasises the importance of distinguishing between conducting litigation and advocacy. He is correct that they are two separate regulatory actions. However, assisting with litigation does not mean conducting mitigation. For example, attending a hearing on behalf of the principal solicitor, like a case management conference, counts as assisting the litigation because it helps move the case forward.

Under the supervision of that individual

DJ Pratt considered HS (Chambers Proceedings: Rights of Audience) [1998] 1 FLR 868 (which would have considered the Court and Legal Services Act 1990, with similar exemptions) and quoted the following:-

‘It appears to me that the plain object of s 27(2)(e) is to preserve the traditional right of solicitors’ managing clerks to conduct proceedings in chambers on behalf of the solicitors who employ them. Such managing clerks are traditionally men and women of great experience, often members of the Institute of Legal Executives. They can be relied on to observe the same principles of detachment, objectivity and professional duty as a qualified solicitor or barrister…

I am bound to say that this construction [as suggested] seems to me to fly in the face of the general principle in s 17 by extending rights of audience to an advocate subject to none of the usual constraints which bind an advocate employed or engaged by a solicitor and acting under his instructions in the ordinary way.’

It is that last sentence that stands out to me because I believe this is where DJ Pratt errs. In Re Pomeroy & Tanner [1897] 1 CH 284, Stirling J said the following:-

Let us look at it as a matter of principle. It is well settled that between the client and the London agent of the country solicitor, there is no privity. The relationship of solicitor and client does not exist between the client and the London agent. What is done by the London agent is part of the work done by the country solicitor for the client. The country solicitor does or may do part of the work personally. He does or may do part of his work through clerks whom he employs in the country, or, if necessary, and the necessity occurred in this case, he may do part of his work through a London agent. But as between the country solicitor and the client, the whole of the work is done by the country solicitor. 

While the client had a legal relationship only with the country solicitor and not with the London agent, any work performed by the London agent was legally considered part of the country solicitor’s work, and the solicitor remained fully responsible to the client for all of it.

Whilst Elms would not have a legal relationship with VCS, all work done by Elms would be treated as part of DCB’s work and DCB would have remained full responsible to hte client for all of it. It would also be the case that if costs were being assessed on a standard or indemnity basis, the costs to DCB would be claimed as profit costs and not a disbursement? 

In Crane v Canons Leisure Centre [2007] EWCA Civ 1352, the Court of Appeal determined that the solicitors’ costs are determined by the nature of the work. They said if they delegate the work but retain supervision, and never relinquish responsibility, then those costs are those of the solicitor. 

I return to Elms and DCB.  DCB instructs Elms (a law firm regulated by CILEX). The responsibility of the work is never relinquished. Therefore, any work carried out by Elms must be under the specific instruction and control of DCB.  

In my view if the authorised person within Elms supervises an unqualified advocate, the Elms authorised person is doing so under the control and responsibility of DCB. Therefore, supervision would be met.

Consideration

This goes back to my initial perspective on Halborg and how the Court of Appeal was able to see that the interpretation of sch 3 seemed ‘too academic’. It’s likely that we will come across various first-instance decisions and find ourselves in a ‘battle of the transcript’ situation again, since no appeal at the appropriate appellate level is expected to happen.

Information 

Alec Hancock is a practising Barrister at Magdalen Chambers in Exeter. For instructions on matters, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.