Garrett v Halton Borough Council [2006] EWCA Civ 1017 (18 July 2006)

Garrett v Halton Borough Council [2006] EWCA Civ 1017 (18 July 2006)

A conditional fee agreement entered into before 1 November 2005 is unenforceable if there is a material breach of the applicable statutory requirements, regardless of whether the client suffered actual prejudice. Materiality is assessed by reference to the protection afforded to the client and the proper administration of justice, not by the factual consequences for the client. Enforceability is determined as at the date of the agreement, not at the time of assessment. The court rejected the argument that only breaches causing actual loss to the client are material.

Citation
[2006] EWCA Civ 1017
Parties
Claimant/appellant: Deborah Garrett; Defendant/respondent: Halton Borough Council; Claimants/appellants: David Myatt & Ors; Defendant/respondent: National Coal Board; Intervener: Law Society
Jurisdiction
England and Wales
Judgment Date
18 July 2006
Procedural Posture
Appeal / Court of Appeal (civil Division) Judgment on Appeals From Liverpool County Court and Supreme Court Costs Office
Outcome
Appeals dismissed; CFAs held unenforceable due to material breaches of the Regulations.
Legal Topics
Conditional Fee Agreements, Enforceability of Cfas, Materiality of Breach, Client Protection, Legal Expenses Insurance, Statutory Interpretation
Civil Procedure Costs Law Contract Law Conditional Fee Agreements Enforceability of Cfas Materiality of Breach Client Protection Legal Expenses Insurance +1 more

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Parties

Deborah Garrett

Claimant/appellant

Halton Borough Council

Defendant/respondent

David Myatt & Ors

Claimants/appellants

National Coal Board

Defendant/respondent

Law Society

Intervener

Procedural Posture

Appeal / Court of Appeal (civil Division) Judgment on Appeals From Liverpool County Court and Supreme Court Costs Office

Legal Issues

  1. 1 Does a breach of the Conditional Fee Agreements Regulations 2000 render a CFA unenforceable if the breach is not material or causes no actual prejudice to the client?
  2. 2 Is the enforceability of a CFA to be judged at the time of its making or at the time of assessment?
  3. 3 What constitutes substantial compliance or a material departure under section 58 of the Courts and Legal Services Act 1990 and the Regulations?

Ratio Decidendi

A conditional fee agreement entered into before 1 November 2005 is unenforceable if there is a material breach of the applicable statutory requirements, regardless of whether the client suffered actual prejudice. Materiality is assessed by reference to the protection afforded to the client and the proper administration of justice, not by the factual consequences for the client. Enforceability is determined as at the date of the agreement, not at the time of assessment. The court rejected the argument that only breaches causing actual loss to the client are material.

Court Disposition

Appeals dismissed; CFAs held unenforceable due to material breaches of the Regulations.

Orders

  • Solicitors' fees not recoverable under the unenforceable CFAs.
  • ATE insurance premiums not recoverable from defendants in Myatt claims.