THE ACCIDENT GROUP TEST CASES sub nom SHARRATT v LONDON CENTRAL BUS CO & ORS (2002)

Supreme Court Cost Office (Chief Master Hurst) 27/11/2002

CIVIL PROCEDURE - INSURANCE - CONTRACT - LEGAL PROFESSION - AGENCY - PERSONAL INJURY

COSTS : CONDITIONAL FEE AGREEMENTS : CFA : AFTER-THE-EVENT INSURANCE PREMIUMS : ATE : RECOVERABILITY : PROVISION OF INFORMATION : LEGAL REPRESENTATIVES : SOLICITORS : CLAIMS HANDLERS : ACCIDENT GROUP SCHEME : RIGHTS OF AUDIENCE : RIGHTS TO CONDUCT LITIGATION : DELEGATION : INDEMNITY PRINCIPLE : S.27 AND S.28 COURTS AND LEGAL SERVICES ACT 1990 : REG.1 AND REG.4 CONDITIONAL FEE AGREEMENTS REGULATIONS 2000 SI 2000/692

The task of explaining a conditional fee agreement to a client could properly be delegated to employees of The Accident Group for the purpose of discharging the requirements of Reg.4 Conditional Fee Agreement Regulations 2000 SI 2000/692.

Trial of a preliminary issue in 18 test cases in costs only proceedings concerning whether information given to clients under The Accident Group ('TAG') Scheme was given by a "legal representative" as required by Reg.4 Conditional Fee Agreements Regulations 2000 SI 2000/692. Under the TAG scheme, a potential client would be referred by TAG to a panel solicitor who would send an unsigned client care letter, conditional fee agreement (' CFA'), questionnaire and fact-find oral examination sheet to TAG. A copy of the letter and the CFA would also be sent to the client. A non-legally qualified TAG employee would then visit the client at home and explain the CFA('the Reg.4 information'). The client care letter stated that the TAG employee was acting on behalf of the panel solicitor. The defendant liability insurers contended that: (i) the TAG employee was not a "legal representative" for the purposes of the Regulations; (ii) the obligation for the Reg.4 information to be provided by a legal representative was non-delegable; and (iii) the consequence of a failure to provide that information in the required manner was that CFA was unenforceable and the associated after-the-event ('ATE') insurance premium was irrecoverable.

HELD: (1) The "legal representative" referred to in Reg.4 of the Regulations, ie the person entering into the CFA with the client, could be an individual, a firm or a recognised body. (2) The provisions of ss.27 and 28 , under which unadmitted staff could appear at certain less formal court hearings, were of no assistance in determining whether a TAG employee constituted a legal representative within the meaning of the Regulations. (3) Delegation by the legal representative for the purpose of giving the Reg.4 information was permissible. (4) There was nothing in the legislation that prevented delegation of the task of providing the Reg.4 information to a properly-appointed agent. The essential question was one of quality, namely whether a sufficient explanation was given by or on behalf of the legal representative. If so, the next question was whether the information was provided by a duly-appointed agent. If the essential question was answered in the negative, it would be immaterial who provided the information. (5) Where Reg.4 was not complied with, for example where the explanation given was inadequate, the CFA would be unenforceable and no costs would be recoverable from the paying party. (6) Nothing in this decision affected the recoverability of the ATE premium.

Judgment accordingly.

For related proceedings, see English v Clipson (2002) LTL 20/8/2002.

Timothy Charlton QC and Nicholas Bacon instructed by Rowe Cohen for the claimants. Ian Burnett QC and Benjamin Williams instructed by Carters & Vizards Wyeth for the first defendant. Deborah Taylor instructed by Beachcroft Wansboroughs for the second defendant.