Failure to Provide Notice of Funding… Relief Granted!
Sarah Slesser, Senior Legal Costs Negotiator
A Claimant was granted relief from Sanctions after failing to provide notification of their Conditional Fee agreement by way of form N251 or within 7 days of inception in the case of ANGLIA AUTOFLOW NORTH AMERICA LLC & ANOR v ANGLIA AUTOFLOW LTD (2019).
Background of the Case
In this case the Claimant funded their claim by way of pre LASPO CFA. It was realised that the Claimant had not provided the Defendant with an N251 form or notification that of how the matter was funded within 7 days of the inception of the funding agreement in accordance with the CPR at that time. The sanction for failure to do so was that the funded party could not claim for a success fee for the period of the failure
Upon realisation of the Breach, the Claimant submitted an application for Relief from Sanctions under CPR r.3.9.
To determine whether Relief should be granted the Court considered the same in accordance with the “three stage Denton test” following the outcome in Denton v TH White Ltd [2014] EWCA Civ 906.
It was confirmed in a witness statement by the First Claimant’s Solicitors that the Breach had arisen from them not realising that notification of the funding had to be provided within 7 days of inception.
The first and main point considered was the significance and seriousness of the Breach. It was noted that the Defendant had been made aware of the funding in the Letter before Action albeit outside 7 days of the funding being incepted. It was noted that at this stage an N251 form was not required but all the same information had been provided. Proceedings had also not been issued at that point. Upon issue of proceedings an N251 form would have been served with the Claim form. On this basis the Defendant had not been prejudiced.
It was also noted that the breach did not cause a delay to the Court proceedings as the breach was remedied before the first case management conference.
The final point considered was in reference to Springer v University Hospitals of Leicester NHS Trust [2018] EWCA Civ 436.
The Claimant’s solicitors dealt with the issue as soon as the breach as realised and acted as soon as possible.
Taking into consideration all the points, Relief from Sanctions was granted.
Summary
The Court in this case followed the main points in the cases of Denton and Springer.
In a situation that arises where Relief from Sanctions is required the key point to remember is apply for relief as soon as the breach is discovered and follow the 3 stage “Denton” test.
The quicker the application is submitted the higher chance you will have of being granted relief.
If you find yourself in this situation, please do contact PIC who can provide advice, guidance and assistance in trying to secure you the best chance of being granted relief.
Sarah Slesser / Senior Legal Costs Negotiator / PIC
09.10.19