AB v Mid Cheshire Hospitals NHS Foundation Trust

A decision to replace legal aid with a conditional fee agreement is reasonable where the claimant proves, in the particular circumstances, that the change was necessary to conduct the litigation effectively. The assessment is fact-specific and must focus on the claimant’s reasonable interests, rather than a generic comparison of funding methods. A failure to advise about the loss of a damages uplift or possible additional liabilities will not necessarily make the decision unreasonable, particularly where the prospects of success are uncertain and the omitted benefit is not secure. On appeal, the court should not interfere with an evaluative costs decision falling within the range of reasonable decisions open to the costs judge.

AB, a protected party, pursued a clinical negligence claim against the NHS Trust concerning catastrophic brain injury. His claim was initially funded by legal aid. In February 2013, after a serious dispute arose between the medical experts about causation and against a background of restrictions on experts’ fees, his litigation friend discharged the legal aid certificate and entered into a pre-LASPO conditional fee agreement.

The Regional Costs Judge held that the change of funding was reasonable and declared that the success fee and after-the-event insurance premium were recoverable, subject to later assessment. The NHS Trust appealed, challenging the sufficiency of the evidence, the finding that a CFA was necessary, and the significance of the failure to advise about the Simmons v Castle uplift and further potential liabilities.

1. Appeal dismissed. The declaration that the additional liabilities were reasonably incurred was upheld. The issue was whether the decision to change from legal aid to a CFA was reasonable in the circumstances of this claim.
2. The court applied the approach in Wraith v Sheffield Forgemasters Ltd and Solutia UK Ltd v Griffiths. The question required an objective assessment within the particular circumstances of the litigant, focusing primarily on the claimant’s reasonable interests. The claimant bore the burden of justifying the change. The assessment could not be made by a generic, high-level comparison of funding methods.
3. The Regional Costs Judge was entitled to find that the change was reasonable. By the time of the CFA, the experts were in serious disagreement about causation. A further orthopaedic expert was practically necessary if the claim was to have any realistic prospect of success. There was also evidence that the Legal Services Commission was restricting experts’ hourly rates. The need for freedom to instruct an appropriate expert was therefore a case-specific reason for changing funding.
4. The appellate court applied the approach described in Surrey v Barnet and Chase Farm Hospitals NHS Trust. The decision was an evaluative judgment, or possibly a finding of fact, and fell within the ambit of reasonable decisions open to the Regional Costs Judge. There was no failure to consider relevant matters or reliance on irrelevant matters. The caution required when reviewing factual findings, reflected in McGraddie v McGraddie, Fage UK Ltd v Chobani UK Ltd and Henderson v Foxworth Investments Ltd, also supported restraint on appeal.
5. The absence of advice about the 10 per cent uplift associated with Simmons v Castle did not require a different conclusion. The uplift was not secure because the prospects of success were assessed at 51 per cent and causation remained unresolved. In addition, the Regional Costs Judge had accepted unchallenged evidence that the advice would not have affected the decision.
6. The failure to advise about possible exposure to higher hourly rates and a 100 per cent success fee likewise did not undermine the decision. The risk of no recovery made the ability to pursue the claim with appropriate expert evidence the decisive consideration.
7. The costs of the appeal were awarded to AB. The base costs were summarily assessed at £19,280 plus VAT where applicable. The issue of the success fee on those costs was referred to the Regional Costs Judge, who was also to assess the additional liabilities generally.

1. High Court (Queen's Bench Division): appeal dismissed. The decision of the Regional Costs Judge was upheld, subject to the referral of the success-fee issue for assessment.
2. Regional Costs Judge: declared that the success fee and after-the-event insurance premium were reasonably incurred and recoverable, with quantum reserved for further assessment.