Does your funding die with you?

Linzi Walker – Costs Lawyer

Introduction

The underlying case; Higgins & Co Lawyers Ltd v Evans [2019] EWHC 2809 (QB)

On Thursday 24th October 2019, Mr Justice Pushpinder Saini handed down his judgment in Higgins & Co Lawyers Ltd v Evans [2019] EWHC 2809 (QB), an appeal from a decision of Master McCloud sitting in the SCCO. Roger Mallalieu appeared for the successful appellant.

Background

The original client was a retired Engineer with asbestosis. He was 89 years old at that time. He instructed Higgins & Co Lawyers Ltd to pursue a claim for personal injury and damages. He signed a Conditional Fee Agreement at his home in the presence of Higgins & Co Lawyers Ltd’s Agent on the 19th April 2016. The Conditional Fee Agreement was in the Law Society’s Model Form and the death clause read:

“This agreement automatically ends if you die before your claim for damages is concluded. We will be entitled to recover our basic charges up to the date of your death from your estate.

If your personal representatives wish to continue your claim for damages, we may offer them a new Conditional Fee Agreement as long as they agree to pay the success fee on our basic charges from the beginning of the agreement with you”.

The client died and Higgins & Co Lawyers Ltd claimed against the estate for its fees. A Bill of Costs was presented, claiming that the costs were a liability of the deceased’s estate, relying on the death clause in the Conditional fee agreement. Master McCloud found the death clause could not be relied upon and assessed the Bill of Costs at nil. Master McCloud held that the clause was unenforceable on the basis that it was unusual and onerous and was not brought reasonably and fairly to the attention of the deceased client. Master McCloud referred to the case of Interfoto Picture Library Limited v Stiletto Visual Programmes Limited [1989] QB (CA) – (a case on onerous clauses that reasonable notice of them must be given to a contracting party in order that they be effective).

Permission to appeal Master McCloud’s Order was granted by Steward J on the 2nd April 2019.

On the 24th October 2019, Mr Justice Pushpinder Saini (High Court) overturned Master McCloud’s decision. Saini J found that the death clause was not unusual nor onerous, it was indeed the standard clause in many conditional fee agreements, by signing the conditional fee agreement, the deceased had confirmed that he read and understood the agreement which disposed the Interfoto argument, there was nothing in the Consumer Rights Act that rendered the agreement unenforceable and the Solicitors were entitled to their costs.

Conclusion

There has been uncertainty about the effect of the “death clause” in the Law Society’s Standard Agreement therefore this decision is of great importance to Solicitors who act on a Conditional Fee Agreement basis.

Although in many cases the Solicitors offer a Conditional Fee Agreement to the deceased’s personal representatives, this case provides certainty to Solicitors who are entitled to be paid for work done in other cases.

Note

Higgins & Co Lawyers Ltd did not offer the deceased’s personal representatives a conditional fee agreement, however the matter is ongoing with another firm of Solicitors.

Linzi Walker  | Costs Lawyer | Partners In Costs Ltd
Tel:
01302 386699 | Fax: 0345 872 7674 | Email: Linzi.Walker@pic.legal

16.01.2020

 

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