The residential tenant claimant sought damages from her council for failure to repair her flat. The counciil now objected to being asked to pay her costs, saying that the agreement with her solicitors was champertous, being a Conditional Fee Agreement, in that it indemnified her agsinst costs which might be awarded against her. The deputy master found it champertous on the basis that it was unlawful for a lawyer to agree to conduct litigation for a client on terms which gave him a financial interest in the outcome of the proceedings, save as permitted by legislation. Since no legislation permitted a solicitor to underwrite a client’s liability to pay the costs of the defendant in the proceedings the indemnity in the CFA was void on the grounds of champerty.
Held: The claimant’s appeal succeeded. Times had moved on, and there was now no public policy against such an agreement: ‘this particular scheme was in respect of cases with a low risk, low quantum, low volume, low success fee, and an enhancement of access to justice. There were many advantages, and the disadvantage, the one disadvantage namely the potential conflict of having this modest financial stake in the litigation, was as it seems to me, so small as to be clearly outweighed by the advantages and potential value of this scheme.’
MacDuff J
[2010] EWHC B1 (QB), [2010] 4 Costs LR 526
Bailii
Courts and Legal Services Act 1990 58
England and Wales
Citing:
Cited – Morris and Another v London Borough of Southwark QBD 5-Feb-2010
The residential tenant claimant sought damages from her council for failure to repair her flat. The counciil now objected to being asked to pay her costs, saying that the agreement with her solicitors was champertous, being a Conditional Fee . .
Cited – Wallersteiner v Moir (No 2) CA 1975
The court was asked whether Moir would be entitled to legal aid to bring a derivative action on behalf of a company against its majority shareholder.
Held: A minority shareholder bringing a derivative action on behalf of a company could obtain . .
Cited – Dix v Townend and Another SCCO 30-Jun-2008
The paying party complained that the agreement as to costs of the payee included an indemnity to be given against (potentially) a very large sum, and was champertous.
Held: Deputy Master Victoria Williams said: ‘It is not said in this case . .
Cited – Trendtex Trading Corporation v Central Bank of Nigeria CA 1977
The court considered the developing international jurisdiction over commercial activities of state bodies which might enjoy state immunity, and sought to ascertain whether or not the Central Bank of Nigeria was entitled to immunity from suit.
Cited by:
Appeal from – Sibthorpe and Morris v London Borough of Southwark CA 25-Jan-2011
The court was asked as to the extent to which the ancient rule against champerty prevents a solicitor agreeing to indemnify his claimant client against any liability for costs which she may incur against the defendant in the litigation in which the . .
Cited – Morris and Another v London Borough of Southwark QBD 5-Feb-2010
The residential tenant claimant sought damages from her council for failure to repair her flat. The counciil now objected to being asked to pay her costs, saying that the agreement with her solicitors was champertous, being a Conditional Fee . .
Lists of cited by and citing cases may be incomplete.
Costs, Legal Professions
Updated: 31 October 2021; Ref: scu.402606