Gillian McGivern v MBR Acres Limited & Ors

The indemnity principle applies where criminal legal aid funds civil contempt proceedings. A legally aided party cannot recover more from the paying party than the liability recognised under the applicable legal aid regime, unless primary or secondary legislation expressly disapplies the principle.

Contractual provisions permitting a provider to retain recovered sums do not create a client liability or override the statutory scheme. A receiving party cannot retrospectively vary its costs liability after the costs order to increase the paying party’s liability.

A costs capping order under CPR 3.20 requires all three statutory conditions to be satisfied cumulatively.

The appellant successfully defended civil contempt proceedings and was awarded indemnity costs. Her representation was funded under the criminal legal aid regime because contempt proceedings were treated as criminal proceedings for the purposes of Part 1 of Legal Aid, Sentencing and Punishment of Offenders Act 2012.

The Costs Judge held that the indemnity principle limited recovery from the respondents to the applicable criminal legal aid rates, rejected recovery of privately incurred King’s Counsel fees, and refused to treat the Legal Aid Agency’s assessment as binding. The appellant appealed that decision and also sought a costs capping order for the appeal.

The central issues were whether criminal legal aid disapplied the indemnity principle, whether the appellant could rely on a retrospective private retainer, and whether the criteria for a costs capping order were met.

1. Appeal dismissed. The Costs Judge had correctly held that the indemnity principle applied. A party cannot recover more from an opponent than the party is liable to pay its legal representatives, subject to the legal fiction recognised for sums properly payable by the Legal Aid Agency.
2. The distinction between civil and criminal legal aid was decisive. Regulation 21 of the Civil Legal Aid (Costs) Regulations 2013, read with section 28(2) of Legal Aid, Sentencing and Punishment of Offenders Act 2012, expressly disapplies the indemnity principle in civil legal aid cases. No equivalent provision applies to criminal legal aid, including criminal legal aid funding civil contempt proceedings.
3. The limited scope of Regulation 9 of the Criminal Legal Aid (Remuneration) Regulations 2013 did not create a general entitlement to recover enhanced costs in High Court committal proceedings. Paragraph 8.10 of the Standard Criminal Contract Specification permitted retention of sums which were otherwise recoverable, but could not itself disapply a common law rule or create a liability absent from the statutory scheme.
4. The applicable Regulations did not provide for enhancement of the relevant High Court rates. The Legal Aid Agency’s assessment therefore did not bind the paying party or the Costs Judge.
5. The proposed retrospective revocation of legal aid and reliance on a private retainer was ineffective. Under Radford v Frade [2018] EWCA Civ 119, following Kellar v Williams [2004] UKPC 30, liability crystallises when the costs order is made. Retrospective variation could not increase the paying party’s liability and would also conflict with the statutory prohibition on topping up.
6. The application for a costs capping order under CPR 3.20 was refused. The interests of justice, substantial risk of disproportionate costs, and inadequacy of case management or detailed assessment are cumulative requirements. Summary assessment remained an adequate safeguard, and capping the respondents’ recoverable costs would itself be unjust.

The judgment states that the appeal was from the decision of Costs Judge Whalan dated 18 July 2024, embodied in an order dated 20 November 2024. The High Court dismissed the appeal and refused the application for a costs capping order.