Civil Costs Case Law Update – October 2023
Diag Human SE v Volterra Fietta [2023] Costs LR 1511 Newey, Stuart-Smith, Andrews LJJ -4 October 2023. The solicitors had acted for the claimant under a Conditional Fee Agreement (CFA). The courts below had assessed their bill of $2,929,928.38 at nil in determining a preliminary issue under s.70 Solicitors Act 1974. It was agreed that the CFA was unenforceable as it had included a success fee that could exceed 100% contrary to s 58 Courts and Legal Services Act 1990. However, the offending provision could not be severed enabling the solicitors to be paid base costs, nor were they entitled to payment under a quantum meruit. The sum of $1.5m paid already must be re-paid as equity would not step in to relieve the solicitors from the consequences of providing services pursuant to an unlawful agreement which they were precluded from enforcing.
X v Transcription Agency LLP [2023] EWHC 2283 (KB) Farbey J – 15 September. The claimant in a claim for a subject access request under the Data Protection Act 2018, had made unfounded allegations of dishonesty and improper conduct against the judge. He had also aggressively pursued litigation against the transcription service, seeking to force it to reveal its insurer, in a manner which was outside the norm. Indemnity basis costs ordered.
Glaser KC v Atay [2023] EWHC 2539 (KB) Turner J 12 October 2023. Two claimant barristers undertook work for the defendant under the Public Access Scheme for a 10 day trial at the Central Family Court for fees of £135,000 plus VAT. The trial was adjourned, whereupon they were dis-instructed. The issue on appeal was (i) Did the provisions of the Consumer Rights Act 2015 (“the Act”) operate so as to preclude them from relying upon the terms of their agreement relating to payment; (ii) the consequences if the 2015 Act so operated. Held: the barristers were entitled to nothing. The payment term had been unfair under s.62 of the Act as to timing of payment and the consequences of the trial not going ahead. That had created a significant imbalance in the parties’ rights and obligations under the contract. The agreement fell to be treated as if the entirety of the payment term had never existed. It followed that they had no contractual right to payment of the agreed price at any time.
The Scout Association -v- Bolt Burdon Kemp [2023] EWHC 2575 (KB) Freedman J -17 October 2023. It was the defendant’s case that the solicitors should satisfy various adverse costs orders made against the claimant which they could not enforce or otherwise set off due to “QOCS protection” under CPR 44.14 (as then in force). The court held that the solicitors could not be described as the “real party” to the litigation. In the context of an Non-Party-Costs-Order application, that would usually be determined by reference to whether the solicitor was acting “beyond or outside the role of a solicitor.” The firm was not, so the application failed.
Therium Litigation Funding A IC v Bugsby Property LLC [2023] EWHC 2627 (Comm) Jacobs J – 20 October 2023. The court granted an injunction over £27.6m recovered by the defendant in an action financed by a litigation funder under a Litigation Funding Agreement, which might be unenforceable as a Damages Based Agreement following PACCAR [2023] Costs LR 1193. However, it was also arguable that the percentage recovery provision could be severed from the funding agreement meaning that it might be enforceable, so an injunction securing the funds was justified pending resolution of the issue.
