Application of the Mental Capacity Act 2005 and the enforceability of a Solicitor’s retainer.
Furley Page LLP -v- KFL [2025] EWHC 1703 (SCCO) – The SCCO provides a detailed and practical application of the Mental Capacity Act 2005 within the context of a Solicitor’s retainer. Costs Judge Whalan, in his judgment addresses the fundamental question of when a client has the capacity to contract for legal services and the consequences for a Solicitor’s bill if that capacity is then lost. Awareness of its reasoning is vital for any professional managing fee disputes or detailed assessments involving capacity issues.
The case involved a 91-year-old barrister who, after being diagnosed with dementia instructed a new firm of solicitors to change his will and revoke existing Lasting Powers of Attorney. The instruction was at the centre of a wider family dispute. The Solicitor’s fees amounted to £71,850.64. The crux of the dispute was whether, at the time of entering into the retainer on 4th October 2020, the Defendant had the mental capacity required under the Mental Capacity Act 2005, and whether the firm of Solicitors knew or should have known of any incapacity.
Costs Judge Whalan had to balance the legal presumption of capacity under the Mental Capacity Act 2005 with a wealth of evidence. Judge Whalan conducted a detailed analysis of the evidence and established a timeline of capacity, highlighting it was not an ‘all or nothing’ concept.
The initial retainer was found to be valid – the Judge found as a fact that the client did possess the capacity to enter into the retainer in October 2020. He placed significant weight on the Solicitor’s contemporaneous capacity assessments, which were conducted for the specific purpose of the instruction.
Capacity can be lost mid case – he then determined that, due to the gradual deterioration caused by dementia, the client had lost the capacity to contract by a specific later date being 22nd June 2021.
Knowledge of Incapacity is the key date for enforceability – the final step was to determine when the Solicitor knew or should have known, of the loss of capacity. Judge Whalan pinpointed this to 29th July 2021, the date of a related High Court judgment at which point there was credible medical evidence of probable incapacity.
This therefore meant that the retainer was valid and enforceable up to that point, but any fees incurred after that date were vulnerable to challenge as they were not supported by a valid contract.
This judgment clarifies that firms must remain alert to clients’ mental health and have procedures in place to monitor capacity but can rely on enforceability where contemporaneous support exists.
How can PIC assist?
The case reinforces that unpaid costs can be enforceable event if a client later develops capacity issues but only if capacity and knowledge at the time of signing can be demonstrated. Solicitor firms must embed robust monitoring procedures and keep accurate and contemporaneous records.
Costs professionals can act as vital partners here, defending fee recovery, and advising around reducing the risk of successful challenges based on capacity.
Kelly-Anne Kent, Senior Costs Consultant
24.70.2025