The Lord Chancellor v Alexander Johnson & Co Solicitors & Anor

The statutory schemes for litigators’ graduated fees and very high cost cases are intended to operate as distinct regimes. The court must interpret the relevant provisions in their legislative context and may adopt a purposive construction where a strictly literal reading produces an objectively unlikely result, provided the statutory language is not distorted. Paragraph 10(6) of Schedule 2 to the Criminal Defence Services (Funding) Order 2007 applied to a non-panel member operating under the General Criminal Contract, not to a VHCC panel member whose case had been classified as a very high cost case. Where a plea and case management hearing is adjourned part-heard, the hearing may comprise several dates. A guilty plea entered during that PCMH is not a cracked trial for graduated-fee purposes.

The Lord Chancellor appealed against decisions of Costs Judge Simons dated 9 March 2011. The respondents, a firm of solicitors and a barrister, had represented a defendant in complex Crown Court proceedings involving multiple defendants and counts.

The Costs Judge held that the respondents were entitled to payment under the Litigators’ Graduated Fee Scheme rather than the Very High Costs Cases scheme, and that payment should be calculated on the basis of a cracked trial. The appeals concerned the proper interpretation of paragraph 10 of Schedule 2 to the Criminal Defence Services (Funding) Order 2007, and whether the defendant’s guilty plea was entered at a PCMH or after it.

The appeals were allowed. There was no order as to costs.

1. Construction of the funding schemes. The relevant provisions had to be read in the context of the statutory and contractual scheme. Although ordinary meaning remained the starting point, a purposive construction was permissible where a literal reading produced surprising consequences unlikely objectively to have been intended. The court could not add words or distort the language.
2. Article 3(6A) made clear that the 2007 Funding Order did not apply to VHCCs. The VHCC and General Criminal Contract schemes were designed to be distinct, subject to limited provisions dealing with transfers. Paragraph 10(6) of Schedule 2 therefore had to be read as applying to a non-panel member operating under the General Criminal Contract. It did not entitle a VHCC panel member to GFS fees merely because the representation order was withdrawn after classification as a VHCC.
3. The amendment to paragraph 10(5), effective from 3 August 2009, did not alter the meaning of paragraph 10(6). No consequential amendment was required. The Costs Judge’s conclusion on the first issue was therefore wrong.
4. PCMH and cracked trial. If GFS remuneration had been available, the correct basis would have been a guilty plea at a PCMH. The two hearings on 30 November–1 December 2009 and 21–22 January 2010 formed one PCMH, adjourned part-heard. That conclusion was supported by the listing, the parties’ descriptions, and the court log. The fact that trial dates were fixed at the first hearing was relevant but not conclusive.
5. The defendant pleaded guilty at that PCMH. The case was consequently a guilty-plea case rather than a cracked trial. The court declined to formulate an exhaustive definition of a PCMH, which remained dependent on the circumstances of each case.

Evidence from the drafter of the statutory instrument was inadmissible to establish subjective legislative intention.

• High Court (Queen’s Bench Division): allowed the Lord Chancellor’s appeals against the Costs Judge’s decisions dated 9 March 2011. The respondents were not entitled to GFS remuneration on the facts and statutory scheme. The alternative finding was that, if GFS applied, the case was remunerable as a guilty plea at a PCMH, not as a cracked trial. No order as to costs.