Dix v Townend & Anor [2008] EWHC 90117 (Costs) (30 June 2008)

Dix v Townend & Anor [2008] EWHC 90117 (Costs) (30 June 2008)

A solicitor's CFA that includes an uncapped indemnity against opponent's costs creates a material risk of conflict with the solicitor's duties to the court and tends to corrupt public justice. Such an agreement offends public policy and is unenforceable, regardless of whether it constitutes champerty in the strict sense.

Citation
[2008] EWHC 90117 (Costs)
Parties
Claimant: John Dix; First Defendant: Declan Townend; Second Defendant: Frizzell Financial Services
Jurisdiction
England and Wales
Judgment Date
30 June 2008
Procedural Posture
Costs Assessment / Reserved Judgment on Preliminary Issues in Detailed Assessment of Costs
Outcome
Indemnity clause in the CFA is unenforceable as contrary to public policy; costs agreement not enforceable against the second defendant.
Legal Topics
Champerty, Maintenance, Conditional Fee Agreements, Solicitor Indemnity, Public Policy, Enforceability of Retainers
Civil Procedure Legal Costs Professional Conduct Champerty Maintenance Conditional Fee Agreements Solicitor Indemnity Public Policy +1 more

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Parties

John Dix

Claimant

Declan Townend

First Defendant

Frizzell Financial Services

Second Defendant

Procedural Posture

Costs Assessment / Reserved Judgment on Preliminary Issues in Detailed Assessment of Costs

Legal Issues

  1. 1 Whether a solicitor's CFA including an indemnity against opponent's costs is unlawful at common law for champerty or maintenance
  2. 2 Whether such a retainer is unenforceable as an unauthorised contract of insurance under the Financial Services and Markets Act 2000

Ratio Decidendi

A solicitor's CFA that includes an uncapped indemnity against opponent's costs creates a material risk of conflict with the solicitor's duties to the court and tends to corrupt public justice. Such an agreement offends public policy and is unenforceable, regardless of whether it constitutes champerty in the strict sense.

Court Disposition

Indemnity clause in the CFA is unenforceable as contrary to public policy; costs agreement not enforceable against the second defendant.

Orders

  • Declaration that the indemnity clause is unenforceable
  • Costs to be determined on another day if necessary