Gaynor v Central West London Buses Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Dyson,Sir Martin Nourse,Lord Justice Auld |
| Judgment Date | 28 July 2006 |
| Neutral Citation | [2006] EWCA Civ 1120 |
| Date | 28 July 2006 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A2/2005/2657 |
[2006] EWCA Civ 1120
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM ROMFORD COUNTY COURT
HIS HONOUR JUDGE PLATT
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Auld
Lord Justice Dyson and
Sir Martin Nourse
Case No: A2/2005/2657
Mr John Foy QC (instructed by Messrs Sherringtons) for the Appellante
Mr Paul Jones of Messrs Burr Sugden) for the Respondent
Introduction
The issue arising in this case is the meaning of a conditional fee agreement ("CFA") as defined by section 58(2) (a) of the Courts and Legal Services Act 1990 (as amended by the Access to Justice Act 1999) ("the 1990 Act") . It turns on the true construction of a retainer letter sent to the claimant by Messrs Sherringtons, her solicitors, on 20 November 2002. His Honour Judge Platt held that it was a CFA and that, because it did not satisfy the relevant statutory conditions, it was unenforceable: see section 58(1) . The result was that the solicitors were not entitled to any remuneration for their work for the claimant. The importance of this case to the solicitors is that the retainer letter is their standard client care letter. We are told that a letter in similar terms is in common use in the profession.
The facts
On 8 November 2002, the claimant was injured while travelling on one of the defendant's buses which was involved in a collision with another of its buses. She consulted Messrs Sherringtons, solicitors, who sent her a retainer letter dated 20 November 2002. The letter lies at the heart of this appeal. The defendant admitted liability soon after the accident. The claimant eventually issued proceedings in the Romford County Court on 22 January 2004 and on 24 February she entered judgment in default of acknowledgement of service. On 26 February, the defendant offered to pay £3750 in respect of the claim for general damages and the sum claimed as special damages. This offer was accepted on 1 March. On 5 April, the compromise was embodied in a consent order which also provided that the defendant should pay the claimant's costs to be assessed, if not agreed, on the standard basis.
The parties were unable to agree costs and the matter proceeded to a detailed assessment before the master. Before Master Berry, the defendant argued that the retainer was a CFA within the meaning of section 58(2) (a) of the 1990 Act and that it was unenforceable by reason of section 58(1) of the 1990 Act because it failed to comply with certain of the Conditional Fee Agreements Regulations 2000 ("the Regulations").
Section 58 of the 1990 Act provides, so far as material:
"(1) A conditional fee agreement which satisfies all of the conditions applicable to it by virtue of this section shall not be unenforceable by reason only of its being a conditional fee agreement; but (subject to subsection (5)) any other conditional fee agreement shall be unenforceable.
(2) For the purposes of this section and section 58A-
(a) a conditional fee agreement is an agreement with a person providing advocacy or litigation services which provides for his fees and expenses, or any part of them, to be payable only in specified circumstances; and
……….
(3) The following conditions are applicable to every conditional fee agreement-
(a) it must be in writing;
(b) it must not relate to proceedings which cannot be the subject of an enforceable conditional fee agreement; and
(c) it must comply with such requirements (if any) as may be prescribed by the Lord Chancellor."
Section 119(1) defines "litigation services" as "any services which it would be reasonable to expect a person who is exercising, or contemplating exercising, a right to conduct litigation in relation to any proceedings, or any contemplated proceedings, to provide."
The retainer letter
There is no evidence as to whether the claimant accepted the terms of the retainer letter, but the argument has proceeded on the basis that she did. The issue of costs is addressed in the middle of the second page. The letter gives the firm's hourly rates and estimates that if the case goes to a full hearing the fee is likely to be £6000 plus VAT and disbursements. It says that if the claimant wins, she will recover the majority of her costs from the defendant, and if she loses, she is likely to be ordered to pay the defendant's costs. On the third page, the letter says that the solicitors will not seek a payment on account of costs, except possibly for experts' reports. So far, the letter contains nothing exceptional.
The last five paragraphs on the third page are in these terms:
"Although it is the usual practice of all Solicitors to obtain a payment on account of costs and disbursements in your particular matter we shall not be doing so. If your opponent admits liability his/her insurers will pay your legal costs.
However and where liability is not admitted and you decide to pursue your case further then you may be liable to pay for the cost of medical reports, police reports and other expert reports as are required. If you succeed and recover compensation from your opponent you will be reimbursed your outlay.
If your claim is disputed by your opponent and you wish to pursue your claim through litigation then we will require a payment on account of costs and disbursements. Before requesting any payment we will discuss the alternative methods of funding your case with you. You may have the funds to pay for the cost of litigation. You may wish to enter into a Conditional Fee Agreement with us and apply for after sthe event legal expenses insurance to cover your opponent's cost in litigation. If you and your partner already have legal expenses insurance, through possibly your household contents policy of insurance, motor car policy of insurance or stand alone before the event legal expenses policy of insurance, tell us and we will assist you in applying to them for cover. In any event and when we next meet please bring along your policies of insurance for us to check through on your behalf.
Were you to meet the cost of litigation from your own funds then we will bill you at regular intervals as your matter progresses and in certain cases we will allow you time for payment of bills or accept an instalment arrangement. Any such arrangement is at the discretion of Mr. Newman.
If your claim is disputed by your opponent and you decide not to pursue your claim then we will not make a charge for the work we have done to date."
The decisions below
On 8 February 2005, the master gave a short judgment in which he said that he was not persuaded that the retainer letter was intended to be a CFA. He said that, if required, he could give more detailed reasons. He was asked for further reasons which he gave in his judgment of 8 April 2005. He accepted the submissions made on behalf of the claimant that there was no CFA in this case because there was no...
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