Legal Cost Specialists

Posts made in July, 2006

Garrett v Halton Borough Council and Myatt v National Coal Board

By on Jul 18, 2006 | 0 comments

Judgment has been handed down by the Court of Appeal in the long awaited cases of Garrett v Halton Borough Council and Myatt v National Coal Board [2006] EWCA Civ 1017. These cases will have a crucial impact on pre-November 2005 CFAs. Both cases revolved around interpreting the Court of Appeal’s earlier decision in Hollins v Russell [2003] EWCA 718 and the “materiality” test laid down in that case to determine whether a breach of the Conditional Fee Agreement Regulations 2000 rendered a CFA invalid: “Has the particular departure from a regulation pursuant to section 58(3)(c) of the 1990 Act or a requirement in section 58, either on its own or in conjunction with any other such departure in this case, had a materially adverse effect either upon the protection afforded to the client or upon the proper administration of justice?” The Court was required to determine whether the test of “materiality” quoted above requires a court to consider whether the client has suffered actual prejudice as a result of an alleged failure to satisfy the rules. A related question was whether the enforceability of a CFA was to be judged by reference to the circumstances existing at the time when it is entered into, or by reference to the circumstances known to exist at the time when the question arises for decision. The Court concluded that the “focus on the adverse effect was on the protection afforded to the client, not whether, as a matter of fact, the client had actually suffered any prejudice”. The scheme was “designed to protect clients and to encourage solicitors to comply with detailed statutory requirements which are clearly intended to achieve that purpose”. The “focus of the scheme was on whether the CFA satisfied the applicable conditions, not on the actual consequences of a breach of one of the requirements of the scheme”. Therefore, whether a client has actually suffered prejudice is irrelevant as to whether there has been a material breach of the rules. The time for determining whether there has been a breach is at the date of the CFA and not some later point. The effect of this conclusion is that where the Court is considering whether there has...

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