Burridge and Another v Stafford and Another. Khan v Ali
| Jurisdiction | England & Wales |
| Judge | LORD WOOLF, MR,LADY JUSTICE BUTLER-SLOSS,LORD JUSTICE ROBERT WALKER |
| Judgment Date | 28 July 1999 |
| Judgment citation (vLex) | [1999] EWCA Civ J0728-21 |
| Docket Number | CCRTF/0689/2 and 1995/1374 |
| Court | Court of Appeal (Civil Division) |
| Date | 28 July 1999 |
[1999] EWCA Civ J0728-21
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE BRISTOL COUNTY COURT AND THE CENTRAL LONDON COUNTY COURT
(HIS HONOUR DEPUTY JUDGE TOYN AND HIS HONOUR JUDGE ZUCKER QC)
Royal Courts of Justice
Strand
London WC2
The Master of The Rolls
(Lord Woolf)
Lady Justice Butler-Sloss
Lord Justice Robert Walker
CCRTF/0689/2 and 1995/1374
MR P WADSLEY (Instructed by Messrs Montague Harris, Bristol, BS37 6AN) appeared on behalf of the Appellants.
MR J DAGNALL (Instructed by Messrs Coles Miller, Poole, Dorset, BG15 2PG) appeared on behalf of the Respondents.
MISS D HEER (Instructed by R W Anderson, London, W1N 7LE) appeared on behalf of the Respondent/Dr Ali.
MR Y SURI (Instructed by Messrs Hardial Singh & Co) appeared on behalf of Messrs Siwan & Co.
MR J GIMLETTE (Instructed by the Legal Department Legal Aid Board, London, WC1X 8AA) appeared on behalf of the Legal Aid Board.
This judgment relates to two separate sets of proceedings. The principal question that has to be determined is when a person ceases to be a legally assisted party for the purposes of ss.17 and 18 of the Legal Aid Act 1988. The question is of some considerable significance because while a party is legally assisted, his liability for costs is limited under s.17 and under s.18 an unassisted party has certain rights to recover costs from the Legal Aid Board.
The Statutory Background
S.17 so far as relevant, provides:
"17(1) The liability of a legally assisted party under an order for costs made against him with respect to any proceedings shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances, including the financial resources of all the parties and their conduct in connection with the dispute".
17(3) Provides, inter alia, that a legally assisted person's dwelling house, clothes, household furniture and tools and implements of his trade shall not be taken into account in assessing his financial resources for the purposes of the section.
S.18 provides:
"18(1) This section applies to proceedings to which a legally assisted person is a party and which are finally decided in favour of an unassisted party.
(2) In any proceedings to which this section applies the court by which the proceedings were so decided may, subject to subsections (3) and (4) below, make an order for the payment by the Board to the unassisted party of the whole or any part of the costs incurred by him in the proceedings.
(3) Before making an order under this section, the court shall consider what order for costs should be made against the assisted party and for determining his liability in respect of such costs.
(4) An order under the section in respect of any costs may only be made if –
(a) an order for costs would be made in the proceedings apart from this Act;
(b) as respects the costs incurred in a court of first instance, those proceedings were instituted by the assisted party and the court is satisfied that the unassisted party will suffer severe financial hardship unless the order is made; and
(c) in any case, where the court is satisfied that it is just and equitable in all the circumstances of the case that provision for the costs should be made out of public funds.
(6) In this section "costs" means costs as between party and party and includes the costs of applying for an order under this section; and where a party begins to receive representation after the proceedings have been instituted, or ceases to receive representation before they are finally decided, or otherwise receives representation in connection with part only of the proceedings, the reference in subsection (2) above to the costs incurred by the unassisted party in the proceedings shall be construed as a reference to so much of those costs as is attributable to that part."
There is no appeal against a decision of a court in respect of an application under S.18 except on a point of law.
S.2 of the Act provides help as to the interpretation of the Act. S.2(11) provides that :
"In this Act "legally assisted person" means any person who receives under this Act advice, assistance, mediation or representation and, in relation to proceedings any reference to an assisted party or unassisted party is to be construed accordingly".
Advice, assistance, and mediation are all given meanings by s.2. The meaning given to "assistance" is wide, it includes assistance in taking any of the steps in respect to proceedings "whether by taking such steps on his behalf (including assistance by way of representation) or by assisting in taking them on his own behalf".
The meaning given to "representation" includes all such assistance as is usually given by a legal representative including steps preliminary or incidental to any proceedings.
In addition to the sections of the Act to which reference has already been made, it is also necessary to take into account the provisions of the Civil Legal Aid (General) Regulations 1989. The Regulations are made for the purposes of the provision of civil legal aid under part IV of the Act. Ss.17 and 18 are contained in part IV. Regulation 3 contains a definition for the purposes of the Regulations "unless the context otherwise requires" of "assisted person" which is quite distinct from that contained in s.2 of the Act. It is that in the Regulations "assisted person" means a person in respect of whom a certificate issued under these Regulations is in force". The distinction between the meaning given to "assisted person" in the Regulations and in s.2 of the Act will be immediately obvious. The meaning of the Act depends on whether the person "receives" advice etc. Under the Regulations the meaning depends upon whether there is a certificate in force. The Regulations contain detailed provisions as to when a certificate is issued, amended, revoked or discharged (revocation and discharge have different effects, see Regulation 74; for present purposes however it is only necessary to consider discharge). They are accompanied by requirements to give notice of any of these events. In particular when a certificate is discharged, under Regulation 82 a solicitor, who receives notice of discharge, is required to serve notice of such discharge on any other persons who are parties to the proceedings, to inform counsel and to send a copy of the notice to the appropriate court office or registry.
The process of discharge can be far from speedy because the assisted person has to be given an opportunity to show cause why his certificate should not be discharged and there are also appeal provisions. In the meantime the certificate is not discharged. (See Regulation 81(1)).
Part XIII of the Regulations contains Regulation 124 which places restrictions on recovering costs from an assisted litigant until the court has determined the amount of his liability. It is also provided by Regulation 126 that in determining the amount of the assisted persons' liability for costs, various matters are to be excluded including his dwelling house. As to the matters to be excluded regulation 126 mirrors s.17 of the Act.
The Stafford CaseThe Stafford Case
Having set out the statutory background, it is now appropriate to turn to the facts of the first set of proceedings with which the court is concerned. This is an appeal by the second defendant, Mrs Stafford, against orders as to costs made by Her Honour Judge Darwell-Smith and His Honour Deputy Judge Toyn at the Bristol County Court. Mrs Stafford's former husband is the first defendant but the proceedings have not been continued against him as he has been made bankrupt.
Mrs Stafford is the freeholder of a property known as "The Portcullis Coach House" at Badminton. The claimants have a charge dated 2 March 1988 executed by Mrs Stafford over the property. The charge secures sums payable to the claimants under an agreement for the sale of the shareholding of two companies. Mrs Stafford advanced two defences to the claim. The first was that the charge had been obtained through the undue influence of her former husband. This was a wholly unmeritorious defence, put forward by the former husband himself, which was withdrawn while she still had solicitors acting for her by letter of 26 September 1997. The second was based on an alleged set-off against the sums due for breaches of the sale agreement. The second defence, which was only advanced at a late stage, was held by Deputy Judge Toyn to be wholly outweighed by a counter set-off relied on by the claimants.
Mrs Stafford was initially undoubtedly a legally assisted party. The trial was fixed for 27 October 1997. On 14 October 1997, her solicitors offered a settlement on the basis of the charge securing £15,000 plus costs. This offer was made "without prejudice save as to costs". The claimants' solicitors wished to accept the offer on their clients' behalf and provided a draft order to work out the terms of settlement. The second defendant then contended that her solicitors had not been authorised by her to make the offer and it should be withdrawn. Following this on 17 October 1997 the solicitors ceased to act for Mrs Stafford and they informed the claimants' solicitors of this. On 20 October 1997 Mrs Stafford's solicitors informed the Legal Aid Board of a conflict of interest and on 22 October 1997 the Board served notice on Mrs Stafford to show cause why her certificate should not be...
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