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URL: http://www.bailii.org/ew/cases/EWHC/QB/2016/1598.html
Cite as: [2016] WLR(D) 372, [2016] 4 Costs LO 571, [2018] 1 WLR 499, [2016] EWHC 1598 (QB), [2018] WLR 499

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		Neutral Citation Number: [2016] EWHC 1598 (QB)
		Neutral Citation Number: [2016] EWHC 1598 (QB)

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL

01/07/2016

B e f o r e :

MR JUSTICE FOSKETT
with
SENIOR COSTS JUDGE GORDON-SAKER
(as assessor)
____________________

Between:

	ON APPEAL FROM THE SENIOR COURTS COSTS OFFICE MASTER ROWLEY Appeal Ref QB/2015/0487 KAI SURREY (a child and protected party by his litigation friend Amy Surrey)	Claimant
	- and -
	BARNET AND CHASE FARM HOSPITALS NHS TRUST	Defendant

____________________

Benjamin Williams QC and Robert Marven (instructed by Irwin Mitchell LLP) for the Claimants
Alexander Hutton QC (instructed by Acumension) for the Defendant
Hearing dates: 25 and 26 May 2016
____________________

HTML VERSION OF JUDGMENT
____________________

Mr Justice Foskett:

Introduction

There are three appeals before the court from different Costs Judges, each proceeding with the leave of each Costs Judge. The principal point in each appeal concerns the costs payable to a claimant in clinical negligence litigation by the defendant. It is potentially an important point and the outcome of these appeals may have an impact on other cases.

The substantive litigation in each case had been proceeding for several years prior to 1 April 2013 and the claim of each claimant had been advanced with the benefit of Legal Aid. 1 April 2013 was the date from which it would no longer be possible for claimants proceeding under a Conditional Fee Agreement ('CFA') to recover success fees and After the Event ('ATE') premiums from the defendant if successful in the litigation. In the month or so prior to 1 April 2013 the solicitors acting for each claimant (Irwin Mitchell LLP), with the agreement of the Litigation Friend of each claimant, arranged for the Legal Aid Certificates to be discharged in each case and for the funding for each claimant henceforth to be funded by a CFA. In fact, the CFA was what is known generally as a 'CFA Lite' – in other words, a CFA by virtue of which the client's liability to pay his lawyers' costs is limited to the amount of costs recoverable from the other party. Any shortfall is absorbed by the solicitors.

Each case was finalised in a way that was successful from each claimant's point of view resulting in a liability upon each defendant for costs. However, in due course, recovery of the success fee and the ATE premium in each case was challenged by the defendant (in reality, by the National Health Service Litigation Authority – 'the NHSLA') and the Costs Judge upheld the challenge in each case, holding that the changed funding arrangements were not reasonable.

There are nuances surrounding that conclusion in each case, but the principal question in each appeal (which is by way of review: CPR 52.11) is whether that conclusion was wrong in each case. Mr Benjamin Williams QC and Mr Robert Marven, for each of the claimants, argue that it was. Mr Alexander Hutton QC, for each defendant, argues that it was not. There is a subsidiary issue in two of the cases that will only arise if the appeals on the principal issue succeed.

Before going to the substance of the arguments, it is necessary to set out briefly the legislative and other relevant history that underlies the issues that have arisen.

The history of the statutory scheme

The background to the introduction of CFAs is summarised in Chapter 16 of Sir Rupert Jackson's Preliminary Report concerning his 'Review of Civil Litigation Costs' (May 2009). It is unnecessary to repeat or summarise it here save to record the obvious proposition that CFAs were introduced and encouraged as a means of funding civil litigation at a time when there was diminishing availability of public funding for such litigation. This proposition finds a reflection in Lawrence and another v Fen Tigers Ltd and others (No 3) (Secretary of State for Justice and others intervening) [2015] 1 WLR 3485, where Lord Neuberger PSC at [27] said this:

"In MGN v United Kingdom (2011) 53 EHRR 195, para 197 of the majority judgment of the European Court of Human Rights … acknowledged that the CFA with recoverable success fees "sought to achieve the legitimate aim of the widest public access to legal services for civil litigation funded by the private sector". A deliberate policy of the 1999 Act regime was to impose the cost of all CFA litigation on unsuccessful respondents as a class: see per Lord Hoffmann in Campbell v MGN Ltd (No 2) [2005] 1 WLR 3394, para 16. There was to be a fundamental rebalancing of the means of access to justice by resort to the private sector rather than by the use of public (legal aid) funds. Instead of placing a burden on the legal aid fund, legal proceedings were to be funded in the first instance by a party's lawyers (who would undertake the work "on risk" in exchange for a potential success fee) and then, if the proceedings were successful, the success fee would be transferred to the losing party."

The history of the CFA scheme is set out in some detail in Lord Neuberger's judgment at [12] – [25].

The recoverability of success fees and ATE premiums was provided for respectively by sections 27 and 29 of the Access to Justice Act 1999.

Section 27 inserted a new section 58A(6) into the Courts and Legal Services Act 1990 which provided as follows:

"A costs order made in any proceedings may, subject in the case of court proceedings to rules of court, include provision requiring the payment of any fees payable under a conditional fee agreement which provides for a success fee."

Section 29 provided as follows:

"Where in any proceedings a costs order is made in favour of any party who has taken out an insurance policy against the risk of incurring a liability in these proceedings, the costs payable to him may, subject in the case of court proceedings to rules of court, include costs in respect of the premium of the policy."

Both provisions came into effect on 1 April 2000. The recoverability of both was seen as a way in which those acting for claimants could recover in successful cases the costs associated with funding unsuccessful cases: see Callery v Gray [2001] 1 WLR 2112 (CA), para 61.

The provisions in the 1999 Act provided for recovery in principle of the success fees and the ATE premiums and enabled the setting in place of a "recoverability regime". The provisions governing the way in which the court would decide on any contested issue about recovery in any particular case prior to 1 April 2013 were CPR Part 44.4 and the Costs Practice Direction then in existence. Part 44.4 was, so far as material, in the following terms:

"(1) Where the court is to assess the amount of costs (whether by summary or detailed assessment) it will assess those costs -

(a) on the standard basis; or

(b) on the indemnity basis,

but the court will not in either case allow costs which have been unreasonably incurred or are unreasonable in amount.

…

(2) Where the amount of costs is to be assessed on the standard basis, the court will—

(a) only allow costs which are proportionate to the matters in issue; and

(b) resolve any doubt which it may have as to whether costs were reasonably and proportionately incurred or were reasonable and proportionate in amount in favour of the paying party …."

Part 44.5(1) was, so far as material, in the following terms:

"The court is to have regard to all the circumstances in deciding whether costs were … [proportionately] and reasonably incurred …."

The Costs Practice Direction, which dealt with the way in which a success fee was assessed and whether the level of insurance cover was reasonable, was as follows:

"11.7 Subject to paragraph 17.8(2), when the court is considering the factors to be taken into account in assessing an additional liability, it will have regard to the facts and circumstances as they reasonably appeared to the solicitor or counsel when the funding arrangement was entered into and at the time of any variation of the arrangement.

11.8(1) In deciding whether a percentage increase is reasonable relevant factors to be taken into account may include:

(a) the risk the circumstances in which the costs, fees or expenses would be payable might or might not occur;

(b) the legal representative's liability for any disbursements;

(c) what other methods of financing the costs were available to the receiving party.

…

11.10 In deciding whether the cost of insurance cover is reasonable relevant factors to be taken into account include:

(1) where the insurance cover is not purchased in support of a conditional fee agreement with a success fee, how its cost compares with the likely cost of funding the case with a conditional fee agreement with a success fee and supporting insurance cover;

(2) the level and extent of the cover provided;

(3) the availability of any pre-existing insurance cover;

(4) whether any part of the premium would be rebated in the event of early settlement;

(5) the amount of commission payable to the receiving party or his legal representatives or other agents."

That was the regime applicable prior to 1 April 2013 and, as will appear below (paragraphs 20 and 21), that regime was expressly retained in respect of CFAs entered into before that date.

The "recoverability issue" was reflected upon in Sir Rupert's Final Report (December 2009) in Chapter 10 (pp. 108-116) in which he identified four "flaws" in the recoverability regime one of which was as follows:

"The second flaw is that the party with a CFA generally has no interest in the level of costs being incurred in his or her name. Whether the case is won or lost, the client will usually pay nothing. If the case is lost, the solicitors waive their costs and pay the disbursements, in so far as not covered by ATE insurance. If the case is won, the lawyers will recover whatever they can from the other side either (a) by detailed or summary assessment or (b) by negotiation based upon the likely outcome of such an assessment."

As a result of the various flaws identified, he recommended the abolition of recoverability, but in order to assist claimants in personal injuries litigation to meet success fees under CFAs for which, in this scenario, they would become liable he recommended (p. 112), inter alia, -

"(i) The level of general damages for pain, suffering and loss of amenity be increased by 10% across the board.

(ii) The amount of success fee which lawyers may deduct be capped at 25% of damages, excluding any damages referable to future care or future losses …."

The recommendations in the Final Report covered many other aspects of the civil litigation costs regime. The recommendations relating to CFAs in the personal injuries sphere (of which clinical negligence claims form a part) were accepted and implemented by the statutory provisions set out hereafter and the underlying rationale for the two recommendations identified in the preceding paragraph were noted and endorsed in Simmons v Castle (see paragraph 24 below).

The Legal Aid, Sentencing and Punishment of Offenders Act 2012 ('LASPO') was the legislative vehicle by which the changes were made. Section 58A(6) of the Courts and Legal Services Act 1990 was reversed by section 44(4) of LASPO, with the effect that costs orders may not include provision for the payment of success fees. Section 29 of the Access to Justice Act 1999 was revoked by section 46(2) of LASPO and section 46(1) inserted a new section 58C into the Courts and Legal Services Act 1990 as follows:

"Recovery of insurance premiums by way of costs

(1) A costs order made in favour of a party to proceedings who has taken out a costs insurance policy may not include provision requiring the payment of an amount in respect of all or part of the premium of the policy, unless such provision is permitted by regulations under subsection (2).

(2) The Lord Chancellor may by regulations provide that a costs order may include provision requiring the payment of such an amount where -

(a) the order is made in favour of a party to clinical negligence proceedings of a prescribed description,

(b) the party has taken out a costs insurance policy insuring against the risk of incurring a liability to pay for one or more expert reports in respect of clinical negligence in connection with the proceedings (or against that risk and other risks),

(c) the policy is of a prescribed description,

(d) the policy states how much of the premium relates to the liability to pay for an expert report or reports in respect of clinical negligence ("the relevant part of the premium"), and

(e) the amount is to be paid in respect of the relevant part of the premium …."

The amendments made by section 46 of LASPO do not apply in relation to a costs order made in favour of a party to proceedings who took out a costs insurance policy before 1 April 2013 in respect of most proceedings (other than mesothelioma, insolvency and publication and privacy). The regulations made in due course under section 46(2) related only to clinical negligence cases and allowed the recovery of the cost of insuring against the potential liability to pay for expert evidence on liability and causation. This constituted a limited exception to the general rule thus allowing claimants to obtain evidence of that nature at no cost to them.

Parts 43 to 48 of the CPR were amended substantially with effect from 1 April 2013, including the revocation of the rules relating to the recoverability and assessment of "additional liabilities" (an expression that includes the percentage increase provided for under a CFA and the ATE insurance premium), but the new CPR Part 48 provided in effect that any CFA entered into prior to 1 April 2013 would be governed by the regime that had applied until then (except in relation to insolvency-related proceedings, publication and privacy proceedings and mesothelioma claims).

In short, this means that in respect of the three cases with which these appeals are concerned (in all of which proceedings were issued before 1 April 2013 and in respect of each the relevant CFA was concluded prior thereto) the former test of proportionality will apply to them (see the new CPR 44.3(7)) as will the provisions as to reasonableness (which have not in fact changed).

I have been told that the Bill that eventually became LASPO was introduced into the House of Commons in June 2011 and the Act received the Royal Assent on 1 May 2012. There was, I believe, a fair degree of uncertainty about precisely when it would come into force, but a commitment was given that it would be implemented in April 2013 and that commitment was met. I will return to the possible implications of the relatively long gestation period for the provisions of importance to this appeal in due course (see paragraph 98 below).

There is one significant factor to add to that legislative framework. Sir Rupert Jackson's recommendation concerning the 10% uplift on general damages (see paragraph 17 above) was given effect by the Court of Appeal in the case of Simmons v Castle: see [2012] EWCA Civ 1039 and [2013] 1 WLR 1239. The net effect of that case was expressed in the revised paragraph 20 of the judgment which was in the following terms:

"Accordingly, we take this opportunity to declare that, with effect from 1 April 2013, the proper level of general damages in all civil claims for (i) pain and suffering, (ii) loss of amenity, (iii) physical inconvenience and discomfort, (iv) social discredit, or (v) mental distress, will be 10% higher than previously, unless the claimant falls within section 44(6) of the 2012 Act …."

Section 44(6) of LASPO provided that the reversal of section 58A(6) of the Courts and Legal Services Act 1990 shall not prevent the recovery of a success fee under a CFA entered into before section 44(4) comes into force (in these cases 1 April 2013).

It follows that in each of the three cases with which these appeals are concerned any award made by a court, had any or all of them gone to trial, would have resulted in a 10% increase in the general damages element (as defined in Simmons v Castle) compared with what might otherwise have been awarded. By entering into a CFA before 1 April 2013, a previously legally-aided claimant necessarily lost that uplift. As will appear (see paragraph 42 et seq below), this is said to be an important factor for consideration in the context of the issues before the court.

I will turn to the way the arguments concerning the disputed items of costs were dealt with below, but before doing so will merely identify the salient aspects of the issues arising in each of the three cases.

The three cases

Surrey

In this case the claimant suffered very serious brain damage as a result of events surrounding his birth on 1 December 2004. A legal aid certificate to bring proceedings was granted on 9 January 2006. A contested trial on liability was due to take place on 26 March 2012, but a roundtable meeting ('RTM') on 10 February 2012 resulted in a settlement of that issue with the claimant recovering 70% of the full damages which were to be assessed in due course. That settlement was approved by the court on 21 March 2012.

On 15 March 2013 the legal aid certificate was discharged. On 21 March 2013 the claimant's litigation friend entered into a CFA with Irwin Mitchell LLP and a 'LitigATE' policy of ATE insurance entered into with Allianz Insurance plc on 22 March 2013.

A further RTM concerning quantum took place on 29 August 2013 resulting in an agreement, subject to the approval of the court, for payment of a lump sum of £2.4 million and of periodical payments starting at £74,400 per annum and gradually rising to £154,236 per annum for life after the age of 19. That settlement was approved by the court on 4 November 2013.

I will return to the issue of the 10% uplift more generally below (see paragraph 42 et seq), but Mr Hutton says that the Schedule of Loss advanced prior to the RTM had totalled £10,236,078 on a capitalised 100% basis, or £7,165,255 on a capitalised 70% basis. He says that the defendant's estimate that general damages on a 100% basis would have been in the region of £238,500 to £297,000 was not disputed on behalf of the claimant and thus on a 70% basis the 10% uplift would have been between £16,695 and £20,790. This contention was advanced before the Costs Judge (Master Rowley) and not seriously disputed.

Included within the total costs sought on behalf of the claimant was a success fee of £57,119.40 and an ATE premium of £50,681.78, thus totalling £109,968.02, which could not have been claimed but for the conclusion of the CFA to which I have referred. It is those sums that were the subject of challenge before the Master Rowley.

This was an exceptionally sad case in which the claimant, who was the mother of two children aged 10 and 13, entered hospital on 8 September 2008 for a haemorrhoidectomy which ordinarily is routine day surgery. She was noted to be in considerable pain and septic thereafter, but a laparotomy to investigate was negligently delayed until 16 September 2008, when a disruption of the staple line from the operation was discovered. Thereafter she developed adult respiratory distress syndrome (ARDS) and suffered a series of strokes resulting in a devastating brain injury. She also became blind and paralysed. Her life expectancy was very short.

A legal aid certificate was granted on 4 March 2010 and a letter of claim was sent on 7 September 2011. In its letter of response dated 19 January 2012 the defendant admitted the delay in recognising the perforation occasioned during the initial surgery and thus of re-operating. It was admitted that this delay caused some injury to the claimant, but it was not admitted that the strokes resulted from the negligent delay. There was, therefore, a significant causation issue as at that stage and it does not appear that there was ever a full concession on this issue.

On 31 January 2013 proceedings were served accompanied by a Schedule of Loss and a medical report. On 27 February 2013 Irwin Mitchell applied to discharge the legal aid certificate. That occurred on 1st March 2013 and on 27 March 2013 a CFA was concluded with the claimant and ATE insurance taken out. The CFA provided for a success fee of 80% if the claim settled more than three months before the trial/trial window and thereafter of 100%.

Following negotiations, on 13 December 2013 the defendant made a Part 36 offer of £325,000, plus CRU of £26,409, which was accepted on 26 September 2013. The settlement was approved by the court on 13 December 2013.

Included within the costs sought on behalf of the claimant was £32,352.72 for the success fee for Irwin Mitchell and £4,386 for counsel plus £18,881.78 for the ATE premium.

During the course of the negotiations on 27 August 2013 Irwin Mitchell indicated that their "estimate of general damages is £175,000". Whilst no indication of the defendant's view on this matter appears from the papers, Mr Hutton suggests that the Simmons v Castle uplift should, on this basis, be taken as £17,500.

Yesil

The claimant was born by emergency caesarean section on 9 January 2006 with quadriplegic spastic cerebral palsy, microcephaly and global development delay. As a result he is severely physically and mentally disabled, will never be able to live independently and will be entirely dependent on 24/7 care being provided. In due course it was agreed evidence that his life expectancy was estimated to the age of 37.4 years.

Irwin Mitchell obtained legal aid on 19 April 2007. In fact breach of duty was admitted commendably early on 30 April 2010. A letter of claim was sent on 10 November 2010 and full causation was admitted on 15 April 2011. Proceedings were issued on 6 July 2011. The defendant indicated that, in the light of the admissions made, it did not intend to file a Defence and judgment for the claimant was entered on 26 September 2011 with damages to be assessed.

The claimant entered into a CFA and took out ATE insurance on 25 March 2013. In July 2013 a Schedule of loss was served claiming something over £7 million. On 19 February 2014 the defendant accepted the claimant's Part 36 offer for £2.5 million together with staged periodical payments of £89,000 initially rising to £205,000 per annum for life after the age of 19. The capitalised value of that award was £6.2 million.

The Costs Judge spoke of the 10% uplift to be worth between £20,000 and £28,000.

The objections taken to the recoverability of the success fee and the ATE premium in each case

In each of the cases the changed funding arrangements were agreed to by each of the Litigation Friends without having been told that the consequence would be the "loss" of the 10% Simmons v Castle uplift. There has been no suggestion that this was anything other than an oversight and I have been told, and I accept entirely, that appropriate advice was given to the Litigation Friends as soon as the oversight was appreciated (and indeed before the issue was raised in the various costs proceedings) in case they should wish to pursue this matter further.

I will return to this shortly, but I should, perhaps, simply record briefly how the idea of a change of funding arrangements came about. I believe it occurred against the same essential background in each of the cases. I will simply record what Master Rowley said about that background in the case of Surrey. He referred to the evidence of Ms Camilla Stanford-Tuck who was the solicitor conducting that case at the relevant time and recorded the following:

"6. Ms Stanford-Tuck … relates that in February 2013 all "case handlers" were asked by partners in Irwin Mitchell to review their legally aided cases in light of the forthcoming changes being brought into effect by … [LASPO]. There was a concern that existing clients might potentially be adversely affected by the provisions of LASPO.

7. The specific question was asked of Ms Stanford-Tuck as to whether:

"…there was likely to be sufficient cover to fund all of my cases until conclusion, including a trial or assessment of damages hearing. If it was considered by the fee earner that there was to be any future, potential difficulty with the funding of the case until conclusion; and further if the fee earner felt the Claimant would be in a better position with a CFA with ATE funding, then the advice was that funding should be switched in advance of 1 April 2013, in order to avoid the potential adverse [effects] of LASPO.""

That, therefore, represented the instruction given to those dealing with these matters. Ms Junita Cumberland, who was handling the AH case, gave similar evidence. She indicated that the instruction given to the case handlers did not mention the 10% Simmons v Castle uplift and was not herself aware of the point. In the Yesil case the case handler was Ms Sarah Rowland and she referred in her witness statement to the same instruction.

As I have said, in none of these cases was the "loss" of the 10% Simmons v Castle uplift mentioned to the Litigation Friend. It is, perhaps, a fair inference that unless a specific case handler at Irwin Mitchell was aware of the issue, it is unlikely to have been mentioned in any other case where a change of funding took place shortly before 1 April 2013. It is accepted that there are other cases that will emerge in due course where there was a similar change in funding, doubtless prompted by the same instruction, and it is possible that the same omission will be revealed. These appeals, of course, arise solely in the context of cases handled by Irwin Mitchell. Anecdotal evidence suggests that the period prior to 1 April 2013 was one in which there was much uncertainty within the profession about the consequences of the post-LASPO era and that CFAs were being signed in large numbers before the deadline. Mr Stephen Innes, who acted as Counsel for the claimant in Surrey before the Costs Judge, described the atmosphere in the clinical negligence and personal injury world at the time as "febrile", a description from which Master Rowley, an extremely experienced Costs Judge, did not demur in his written judgment. Indeed he accepted what was said expressly:

"I also accept the observations of Mr Innes regarding the atmosphere in early 2013 and the endless debate about how to fund cases pre and post the implementation of LASPO."

It is, of course, unclear in how many other cases conducted by other firms it may emerge that there was a changed funding arrangement shortly before 1 April 2013, but it would be surprising if there were no other instances than those arising under the work being conducted by Irwin Mitchell. Whether the 10% uplift was or was not mentioned in any such case remains to be seen.

A number of submissions were made to the Costs Judges by Mr Hutton, who appeared in each of the cases, but the principal submission (which found favour in each case) was, in summary, as follows: that the Litigation Friend's decision in each case was based upon materially unreasonable advice (by reason of the omission to mention the 10% uplift) and since the burden is on the receiving party to establish that a cost was reasonably incurred and it is unknown what decision would have been made if proper advice had been given, the doubt thus engendered as to whether the additional costs were reasonably and proportionately incurred should be resolved in favour of the paying party: CPR 44.4(2)(b) as it then was (see paragraph 12 above).

There was no statement put before any of the Costs Judges from the relevant Litigation Friend saying that their decision would have been no different if told about the 10% uplift. I will revert to this in due course.

The argument that the advice was "materially unreasonable" is based upon the proposition that a reasonable person in the position of the relevant Litigation Friend would have been likely, when making their decision as to whether to change funding, to attach significance to information that the claimant would lose the 10% uplift if there was a change of funding. Mr Hutton relied by analogy with the case Montgomery v Lanarkshire Health Board [2015] AC 1430, the recent case in which the Supreme Court reviewed the law on informed consent in the context of a medical practitioner's duty to inform a patient as to the risk involved in some proposed treatment. The Supreme Court has indicated clearly in the following passage (at [87]) the nature of the current test:

"… An adult person of sound mind is entitled to decide which, if any, of the available forms of treatment to undergo, and her consent must be obtained before treatment interfering with her bodily integrity is undertaken. The doctor is therefore under a duty to take reasonable care to ensure that the patient is aware of any material risks involved in any recommended treatment, and of any reasonable alternative or variant treatments. The test of materiality is whether, in the circumstances of the particular case, a reasonable person in the patient's position would be likely to attach significance to the risk, or the doctor is or should reasonably be aware that the particular patient would be likely to attach significance to it."

It was by reference to this passage that he deduced the proposition that a reasonable person in the Litigation Friend's position would be likely to attach significance to the loss of the 10% uplift and that, accordingly, that such information was a material factor to be mentioned.

The first case chronologically was Surrey and Master Rowley expressed himself thus in relation to this argument having referred to the foregoing passage in Montgomery:

"88. It seems to me that the test of materiality in this context is very similar. There is no evidence before me to indicate whether the claimant or his Litigation Friend would have considered the abandoning of up to £20,000, which was more or less guaranteed, in return for peace of mind regarding future funding. They may have decided that the system that had apparently worked for 7 years was unlikely to break down in the final stages and they would rather have the money and risk the funding issues. They may have taken the view that QOCS protected them sufficiently not to incur an ATE premium. The possibilities for speculation are endless. What is certain however, is that the Simmons damages were of significance and so should have been explained to the claimant's Litigation Friend so that informed consent to a change in funding could be given. The absence of any evidence from the Litigation Friend on this point, to my mind, speaks volumes.

89. In the absence of being informed of these issues it seems to me impossible to say that the claimant can have made a reasonable choice to change funding arrangements. Consequently, I find that the additional liabilities flowing from the new arrangements are unreasonably incurred and as such are not recoverable from the defendant."

Whilst, of course, Master Rowley's decision did not form any kind of binding precedent, it was accorded the kind of respect by the other Costs Judges ordinarily given to a judge of co-ordinate jurisdiction. In AH Deputy Master Campbell, a former full-time Costs Judge with great experience, expressed himself at greater length than, but to the same effect as, Master Rowley:

"64…in the end the outcome drills down into a relatively short point on the facts. Was this claimant's choice objectively reasonable based upon the advice she was given by Irwin Mitchell, taking all relevant circumstances into account?

63. I conclude that it was not because it was premised upon advice that was more than merely "incomplete" … [a] very significant component was missing. What the client should have been told was that "if you move to a CFA you will forfeit immediately the right to an additional 10% of the general damages you recover, which we estimate could £175,000, so as much as £17,500". It was therefore advice that was unreasonable.

64. As Mr Hutton points out, we do not know what the client would have said had the Simmons advice been given. It could have been "It is worth giving up £17,500 to have the certainty that under a CFA, I will be litigating in a risk-free costs environment in which I will keep all the damages". On the other hand, it could also have been "A settlement discussion has been opened over the telephone, an offer has now been made, we are very close, and £17,500 is a lot of money to give up. As it is, I have the protection of the legal aid certificate. Thank you for giving me this advice but let's play it safe and stick with what we have got as it looks as though we may be able to agree terms before long".

65. Irrespective, it was a material and important factor about which, as Ms Cumberland accepts, her client should have been told.

66. That is not conclusive for the defendant however because Mr Marven submits that materiality is not part of the reasonableness test and, with respect, he is critical of Master Rowley's decision in Surrey. He contends that the limit of the test is to decide whether the cost was reasonably or unreasonably incurred. Mr Hutton's riposte is that materiality is all. If the extra 10% would have been but a few hundred pounds, that would have been immaterial but where, as here, the sum in question could have been as much as £17,500, that was a figure to which the client would have attached significance, and was, accordingly, material. Put another way, the amount in question might have made the client's mind up for her and was therefore material. That is the reason why the cases upon which Mr Hutton relies all focus on the adequacy of the advice and if the client relies on it, then it is material.

67. I agree with Mr Hutton on this issue for the reasons he has given. The Simmons v Castle point was a factor which might have tipped the balance of choice one way or the other had the claimant known about it. It follows in my view that a component which is capable of influencing an outcome must be one that is material to the decision that is taken, in the same way that one that is incapable of doing so because it is immaterial, is not. By way of example, had the extra 10% been £175 and not £17,500 it would have had no bearing on the client's decision because it was de minimis, but where, as here, it could have been as much as £17,500, it is likely to have been a factor, if not the factor, critical in persuading the claimant whether or not to move from legal aid to a CFA. The reason? The 10% was material to her choice. I accept Mr Hutton's submission on this point. It follows that the claimant's decision, based as it was upon advice that was flawed in a material way, was not objectively reasonable and the claims for the success fees and ATE premium therefore fail."

In Yesil District Judge Bedford referred to the passage in Montgomery cited above (see paragraph 49) said this at [77]:

"The same question is I believe relevant to a solicitor. Would a reasonable client believe that the information was significant and relevant? Where a claimant pursues a claim for financial compensation, the issue of an additional £20,000 plus is I believe a significant piece of information."

He then referred to Master Rowley's decision in Surrey and then said this:

"80. On the point of advice, [Counsel for the claimant] argued that the failure of the solicitor to give material advice was not relevant to the consideration as to whether this decision was reasonable. If the advice was deficient, or even negligent then that was an issue between the solicitor and claimant.

81. I accept that it is not necessary for the solicitor to slavishly go through each and every option or scenario. Furthermore, clients are entitled to receive advice that 'leans' one particular way. That is the reason they consult professionals, not for them to 'sit on the fence'. However, even where the solicitor 'leans' one way, the client is entitled to have some understanding as to why. In my judgment it is inconceivable that a client would not consider the option of an additional 10% uplift on general damages a material factor. The omission to raise this factor, even if the claimant immediately rejected it, seriously calls into question the adequacy of the advice given. Irwin Mitchell would appear to have been not so much 'leaning' one way, as giving advice tailored to a decision they had already made. Where one of two or more options available to a client is more financially beneficial to the solicitor, the need for transparency becomes ever greater.

82. Whilst there may be reasons to switch, as I have commented there are equally reasons not to. Further, the choice was not necessarily limited to a choice between Legal Aid and a CFA especially when the existing limit of Legal Aid funding had not been exhausted. For the reasons set out in Surrey when having regard to the additional 10% available, a post LASPO CFA may not have been unreasonable.

83. The limited evidence available to the court from Irwin Mitchell would suggest that the primary reason for the switch was based upon erroneous information. Whilst a decision to switch may be reasonable if funding had been or was shortly to be exhausted, it does not follow that absent that reason the decision remains reasonable. On a standard basis, without cogent evidence that the decision to switch from one type of funding to another was a reasonable decision, then a doubt is raised which should be exercised in favour of the paying party.

84. Further, there was no suggestion prior to the review that a switch was appropriate or necessary. Irwin Mitchell argued that LASPO prejudiced the client in not being able to recover the additional liabilities, hence the need to switch prior to April 2013. However that presupposes that a need to switch from Legal Aid would arise in the future. The action was well advanced and on the agreed Legal Aid figures it was unlikely that any need to switch would arise for funding reasons.

85. Further, any shortfall for solicitor/client work would need to be weighed against the additional 10% which was introduced with the intention to offset any such prejudice.

85. Whilst [there] may possibly be risks that the claimant may have to pay something out of his damages, the available evidence from Irwin Mitchell is not sufficiently real to justify the loss of substantial additional benefits. The reality may well have been that the additional damages received may have more than met any deduction. The risk of exceeding the Legal Aid budget was minimal and there is a lack of particularity of the 'other circumstances' referred to in the witness statement. Again as Master Rowley stated in Surrey, 'The possibilities for speculation are endless'

86. In my judgment, I find myself entirely in agreement with Master Rowley in Surrey. It is for the claimant on a standard basis to show that the decision to switch funding, at the time it was made was a reasonable decision to take. The limited evidence before the court to explain the decision was based on an erroneous premises that the cost limit was shortly to be reached. Further, the solicitors have produced no evidence either by way of file notes, copy letters or even a witness statement from the client as to the advice tendered. In my judgment, the decision to switch was not self-evident or transparent."

There has been debate before me about other aspects of what each Costs Judge said about the case he was considering, but I do not think it can be doubted that what I will call the "Simmons v Castle point" was the determinative factor (or the tipping point) in each case that led to the conclusion that recovery of the success fee and the ATE insurance premium was not reasonable. I will return to deal with this issue in due course, but before doing so I need to examine the additional parameters within which that decision in each case was made.

As I shall observe in due course (see paragraphs 77 and 94 below), the precise issue in the present appeals is unique and, to that extent, there is no previous authority that governs its resolution authoritatively. Understandably, Counsel and the Costs Judges have been looking to such previous authority as exists for some guidance on how to approach it. A central issue in the argument is whether the assessment of the reasonableness of the decision to change funding is, as Mr Williams contends, to be measured by reference to a test of objective reasonableness (with the result that the quality of any antecedent advice given to the claimants' Litigation Friends is irrelevant). In other words, even if the advice leading to the decision is flawed, if the decision itself is reasonable that is an end of the matter. Mr Hutton rejects such a contention, arguing that a "purely objective" test could have the "absurd" consequence that despite flawed advice the additional liabilities must be allowed if there is any objectively reasonable claimant who in the same circumstances would instead have chosen a CFA and ATE.

The starting-point for considering these matters from the perspective of authority is the case of Wraith v Sheffield Forgemasters [1998] 1 WLR 132. It dealt with two appeals on costs issues, both of which raised the question of whether it was reasonable for the receiving party to have instructed London solicitors in the circumstances of litigation in which they were involved. The claims of the receiving parties' arose geographically other than in London and were dealt with in their local courts. The issue identified by Kennedy LJ in his judgment (p. 136) was "whether the liability of the unsuccessful party ordered to pay costs should be restricted to what a reasonably competent solicitor practising in the area of the court, or in the area where the successful party lived, might have been expected to charge, or whether the successful party should be entitled to recover the sums claimed by the solicitor who was in fact instructed to act on his behalf." The applicable provision of the then rules was also identified as being in the following terms:

"On a taxation of costs on the standard basis there shall be allowed a reasonable amount in respect of all costs reasonably incurred and any doubts which the taxing officer may have as to whether the costs were reasonably incurred or were reasonable in amount shall be resolved in favour of the paying party …"

For the purposes of the principle the case establishes it is not necessary to consider the facts further. The importance of the case, for present purposes, is the test that the Court of Appeal considered applicable to resolving an issue under the foregoing rule which, of course, is similar in intent to the rule that applies in these cases. The court held that the articulation of the approach by Potter J, as he then was, was correct when he said this in relation to the objections taken by the paying party in Wraith to the hourly rates claimed:

"… in deciding whether such an objection is sustainable in practice, the focus is primarily upon the reasonable interests of the plaintiff in the litigation so that, in relation to broad categories of costs, such as those generated by the decision of a plaintiff to employ a particular status or type of solicitor or counsel, or one located in a particular area, one looks to see whether, having regard to the extent and importance of the litigation to a reasonably minded plaintiff, a reasonable choice or decision has been made …."

In the other case dealt with (Truscott v Truscott) the Court of Appeal held that the judge had not asked himself the question whether the receiving party "had acted reasonably when he instructed [the relevant firm of solicitors] … having regard to all relevant considerations", those considerations including the importance of the matter to him, the legal and factual complexities so far as he might reasonably be expected to understand them, the location of his home, his place of work and the location of the court in which the relevant proceedings had been commenced, his possibly well-founded dissatisfaction with the solicitors he had originally instructed, the fact that he had sought advice as to whom to consult, and had been recommended to consult the new solicitors, location of the new firm of solicitors (including their accessibility to him and their readiness to attend at the relevant court) and what, if anything, he might reasonably be expected to know of the fees likely to be charged by the new firm as compared with the fees of other solicitors whom he might reasonably be expected to have considered.ve analysis

In Solutia UK Limited v Griffiths [2002] PIQR P16, Latham LJ said this at [16]:

"It seems to me that the conclusion that one can properly reach from the judgment of Kennedy L.J. is that, whereas it is clear that the test must involve an objective element when determining the reasonableness or otherwise of instructing the particular legal advisers in question, nonetheless that must always be a question which is answered within the context of the particular circumstances of the particular litigants with whom the court is concerned."

Mance LJ and Sir Christopher Staughton did not dissent from that analysis.

On this approach, the question of whether an item of cost has been "reasonably incurred" is answered by an objective analysis, but by reference to and in the context of the particular circumstances of the particular litigant.

Although the authorities to which I have referred were decided under a former costs regime, the essential question they were seeking to address is very close, if not identical, to the issue to be decided in the present context. It seems to me that the test ought to remain as the test under the present regime and, if I may say so, it represents the obvious common sense approach: the analysis is conducted within the context of the particular case where the issue arises, but on the basis of an objective analysis of what was reasonable in the particular circumstances.

Neither of those cases dealt with in Wraith raised or involved as one of the "circumstances of the particular litigant" the nature of any advice received from the litigant's solicitors save that it might be said that Mr Wraith's solicitors should have warned him that he might not recover London rates for letting his case be handled by London solicitors. At all events, the case did not deal directly with the relevance to the decision concerning the reasonableness of choosing the particular solicitors of advice received from those solicitors. It follows, in my judgment, that, to the extent that authority on the issue is required, one must look elsewhere for guidance. However, as it seems to me (and as appears to have been accepted by the Costs Judges), Wraith remains the case to which reference is made for the essential guidance on what constitutes an "objective analysis" in this context.

Mr Williams' essential argument is that because the question requires an objective appraisal, the decision under investigation must either be objectively reasonable or objectively unreasonable and that the nature of any advice given prior thereto is irrelevant. There is an attractive simplicity to that submission and Mr Williams submits that it reflects "the existing model of assessment, which is to look at what the receiving party has actually done, and ask whether that was reasonable, without examining the quality or completeness of the advice which led to the decision in question." Mr Hutton disagrees. He relies upon two sources for his submission that, as a matter of law, it is necessary to consider any advice given and on certain general arguments on the merits which, he says, supports the view that it would be wrong to ignore any advice upon which such a decision is based.

He referred, in particular, to Sarwar v Alam [2002] 1 WLR 125. The appeals were heard by a court presided over by the then Master of the Rolls and the distinguished cast list of Counsel indicates the importance attached by the profession and the insurance industry at the time to the issues at stake despite the small amounts involved in the case. It is of significance to note that it was decided in the early stages of the period after it became possible for successful claimants to recover the success fee and the ATE insurance premium from the defendant but before CFA-lite agreements became a recognised way of providing for the claimant's interests. The conflicting concerns prevalent at the time are summarised clearly in [39]-[40] of the judgment of the court. The purpose of the appeal was to give guidance on how solicitors in the then costs environment should advise claimants in the context of the existence of before-the-event ('BTE') insurance for a claimant.

The claimant, who lived in the same household as the defendant, was injured whilst a passenger in the defendant's vehicle in circumstances where the defendant was plainly responsible for the accident. He sought damages for personal injuries and told his solicitor that he was not aware of any legal expenses insurance that may be available to him. The solicitor made no other inquiries as to the existence of any BTE insurance policy which might cover the claimant's legal costs. He then paid premiums in respect of ATE insurance to cover those costs. The claim was settled before legal proceedings were commenced for £2,250 plus the claimant's reasonable costs. In costs-only proceedings the cost of the ATE premiums was disallowed as unreasonable on the basis that BTE cover had in fact been available to the claimant as a passenger via the defendant's motor insurance policy, under which the BTE cover extended, with the defendant's agreement, to any passenger. The Court of Appeal identified (at [13]) "the central question" in the appeal as being "whether it was reasonable in all the circumstances for [the claimant], acting on his solicitor's advice, to incur the cost of the ATE premium without making any further inquiries into the possible existence of BTE cover." The court made it clear (at [41]) that its decision was concerned "only with a relatively small personal injuries claim in a road traffic accident [and not] with claims which look as if they will exceed about £5,000, and [that it was] not concerned with any other type of BTE claim." Its actual decision was summarised in this sentence:

"We have no doubt that, if a claimant possesses pre-existing BTE cover which appears to be satisfactory for a claim of that size, then in the ordinary course of things that claimant should be referred to the relevant BTE insurer."

In [45]-[51] of the judgment the court dealt with the proper practice for a solicitor inquiring about BTE cover. At [46] it was said that "if BTE cover is available, if the motor accident claim is likely to be less than about £5,000 and if there are no features of the cover that make it inappropriate (for instance, if there are a number of potential claimants and the policy cover is only, say, £25,000), the solicitor should refer the client to the BTE insurer without further ado." It was also said that "[the] solicitor's inquiries should be proportionate to the amount at stake. The solicitor is not obliged to embark on a treasure hunt, seeking to see the insurance policies of every member of the client's family in case by chance they contain relevant BTE cover which the client might use." The overriding principle, it was said, was that "the claimant, assisted by his/her solicitor, should act in a manner that is reasonable."

It is essentially upon this part of the judgment that Mr Hutton relies in support of his submission that the nature of a solicitor's advice to his or her client on how to fund the litigation is of relevance to the reasonableness of the decision to incur liability for the success fee and ATE insurance premium.

Before I express my conclusion on that submission, it is interesting to note another aspect of the court's conclusion about the relevance of the quality of the solicitor's advice. It appears in the paragraph dealing with the test to be applied:

"[Counsel for the claimant] submitted that the test of the adequacy of a solicitor's inquiries and advice should be the same as the test applied when determining whether a solicitor has been professionally negligent. Thus the client would either recover the cost of the premium or have a claim against his/her solicitor for breach of duty. We deprecate any attempt to equate the question of reasonableness that a costs judge has to decide with the question whether the claimant's solicitor has been in breach of duty to his/her client. If a solicitor gives advice which proves unsound, it will not necessarily follow that the advice was negligent. The advice will necessarily be based on information provided by the client. If the information is inadequate or inaccurate, the advice may prove to be unsound without any question of fault on the part of the solicitor."

In the present situation, of course, the solicitor's advice will not be dependent upon the information received from the client, but, if Sarwar is to apply with full force, then the nature of any advice given by the solicitor to a client as to the reasonableness of a means of funding is not to be judged by reference to whether it was negligent.

Mr Williams says that the defendants appear to suggest that Sarwar "endorses an inquisition into the quality of the solicitors' advice [but] there is no suggestion at all in Sarwar that this is the case." As I understood his argument, Mr Hutton contends that if, as Mr Williams submits, the advice received by the receiving party is irrelevant if an objectively reasonable decision is made ultimately even incorrect advice has been given, then that submission is inconsistent with Sarwar which is binding.

It seems to me that what Sarwar decided, as a matter of principle, albeit in the context of the issues that arose in that case, was that the advice received by the receiving party on an issue as to the funding of the litigation may be relevant to the question of the reasonableness of the decision concerning funding, but the advice itself is not to be judged by reference to the standards of negligence.

Mr Williams has suggested that the guidance given in Sarwar may not have survived the subsequent decision of the House of Lords in Campbell v MGN (No 2) (see paragraph 6 above). The House of Lords held that it was reasonable for the well-known model to fund her appeal to the House of Lords with the benefit of a CFA and that her potential ability (which was not conceded as a matter of fact) to fund the appeal from her own means was irrelevant to the question of whether the success fee was recoverable in principle. Mr Williams asks rhetorically why should Mr Sarwar have been forced to resort to the BTE insurance policy to the benefits of which he was entitled (and was thus to be treated as a personal asset) if Ms Campbell's means were irrelevant to whether she was entitled to fund her appeal by a CFA? Why also, he says, should Mr Sarwar have relied on an asset that was finite in its ambit (in the sense that it was subject to a limit of indemnity) in a claim where he did not need to rely upon it because he was able to obtain funding from an ATE insurer?

He also submits that the decision of the Court of Appeal in Sousa v Waltham Forest LBC [2011] 1 WLR 2197 throws doubt on Sarwar because of the court's reaffirmation of the traditional view that the availability of funding from an insurance company is res inter alios acta and must be ignored. He draws attention to [45]-[47] and [56] in the judgment of Moore-Bick LJ with which Etherton LJ expressly agreed. This principle was not referred to in the guidance in Sarwar where the potential availability of insurance was expressly taken into account.

Interesting though these arguments are, I do not think it is open to me to hold that Sarwar has effectively been overruled by the subsequent cases. If there is a principle to be deduced from Sarwar that is of relevance to the issues before me, then I must be bound by that principle. I have already endeavoured to state the principle (see paragraph 73 above). As will emerge below, it is important to see how that principle falls to be applied in the relatively unique circumstances that have arisen in the three cases with which these appeals are concerned. Given that the principle was established in very different circumstances it is, in my judgment, important that it is not narrowly confined, but is applied sensibly to the current circumstances.

If Sarwar establishes in a way that is binding upon this court that the advice of a claimant's solicitor may be relevant to the issue of whether choosing to proceed with a CFA is reasonable, then it is not strictly necessary for Mr Hutton to rely upon CPR 44.5(1) (see paragraph 13 above) to bring that advice within the purview of the expression "all the circumstances". Nonetheless, that is another route by which that advice might be treated as a relevant circumstance. Again, however, merely because something should be taken into account as part of "all the circumstances" does not mean that the weight to be attached to it is the same in all situations.

I will return to these matters after reviewing briefly the factors often seen from a claimant's perspective as favouring a CFA over Legal Aid.

The general arguments in favour of a CFA as opposed to Legal Aid from a claimant's perspective

Mr Williams and Mr Marven, in their Skeleton Argument, identified a number of factors that on a generic basis are often seen by a claimant and his/her advisers as militating in favour of a CFA rather than relying upon Legal Aid to fund the litigation. Plainly, not all factors necessarily arise in each case and the weight of each may vary, but it is worth noting the commonly expressed position.

The primary advantage of a CFA-Lite is that the solicitors' entitlement to payment is limited to what is recovered from the paying party and the ATE policy has a self-insured premium. This arrangement is, therefore, risk-free from the claimant's perspective and there is no reduction in the damages recovered even if a Part 36 offer is not bettered.

Under the Legal Aid regime, however, a claimant faces the risk that the 'statutory charge' will diminish any damages awarded because the Legal Services Commission ('LSC') can recoup from the damages any payment it has made to a funded party's solicitors or counsel which is not recovered from the paying party. Equally, where an adverse costs order is made against a legally-aided party during the course of the proceedings, whilst ordinarily the other party cannot enforce the costs award directly against the legally-aided party, it can be set-off against the legally-aided party's costs or damages or both: see Lockley v National Blood Transfusion Service [1992] 1 WLR 492. 78. As Mr Williams and Mr Marven point out, even where the costs are set-off against the legally-aided party`s costs (rather than the damages), the net effect is that the shortfall will then be made up from the claimant's damages under the statutory charge.

As I have indicated, deductions from the award of damages (or the agreed damages) caused in either or both of the foregoing ways do not arise under a CFA-Lite with an ATE policy.

Although a legally-aided party is normally immune to adverse costs consequences, it is open to a court to make an order against such a losing legally-aided party in a sum that "shall not exceed the amount which it is reasonable for him to pay having regard to all the circumstances including his financial resources." This is often expressed to be an order "not to be enforced without the leave of the court" and is usually characterised as a "football pools order." It is an open-ended liability that might be called in if, for example, the legally-aided party inherits a significant sum or does indeed win the lottery or some such other competition. A claimant with an ATE policy does not have this anxiety.

Mr Williams and Mr Marven say that there is always the risk that at some point the LSC might say that a claim has ceased to meet the public funding criteria. I would interpose and say that, from my own experience as Judge in Charge of the QB Civil List I have seen examples of this occurring recently. Mr Williams and Mr Marven say that there were (and are) demanding criteria: where the prospects of success are assessed at 80% or more, the likely damages must exceed the likely costs, where the prospects of success are between 60% and 80%, the likely damages must exceed the costs by a ratio of 2:1 and where the prospects of success are less than 60% then the likely damages must exceed the costs by a ratio of 4:1.

Another disadvantage of Legal Aid, it is said, is that the limit of funding may become inadequate, but the LSC might refuse to increase the limit of expenditure. Another possibility is that the LSC might refuse to increase the scope of a certificate, for example, in order to permit the case to proceed to trial.

Another criticism made by some solicitors of the LSC is that as an organisation it has become increasingly bureaucratic with the result that unnecessary delays occur. This was a point made before Master Rowley in Surrey because he refers to it in [26] of his judgment as follows:

"The replies state that the "process of securing legal aid funding for every step became more complex and cumbersome, which would have impeded the progression of the Claimant's case…" This is a surprising contention given that the claimant had had the benefit of legal aid for seven years at the time of the discharge of the certificate. There is no evidence of the increasing bureaucracy although it is fair to say that it is a comment often made judging by the decisions in LXM and AMH. As is said in those decisions, such bureaucracy is a matter for the solicitor and is not a factor that is relevant for the client to consider."

Mr Hutton says that Master Rowley gave the factor short shrift. It is right that he attached little significance to it and repeated the views apparently expressed in other cases that it was a matter for the solicitor and not a relevant factor for the client to consider. He drew attention to LXM and AMH in that context.

LXM v Mid Essex Hospital Services NHS Trust [2010] EWHC 90185 (Costs) was a decision of Master Gordon-Saker to which I will refer further below (see paragraph 95). Recorded in his judgment was the advice given by Mr Roger Wicks of Gadsby Wicks, a well-known firm of solicitors engaged in clinical negligence work, in which (according to an attendance note) he said this as part of his justification for recommending a CFA to his client in that case:

"… I explained the disadvantages of continuing the Legal Aid. The irrecoverable statutory charge costs will be considerable because of the need to prepare costed case plans and deal with the other increasingly bureaucratic procedures that are being required by the Legal Services Commission. The Legal Services Commission can be slow in approving increases to the scope and cost limitation that can lead to delays …."

A subsequent letter contained the following passage:

"… To be frank, we have a fairly strong preference for working under a conditional fee agreement rather than Legal Aid simply because of the administrative difficulties for us in dealing with the Legal Services Commission who are not very efficient and who are increasingly bureaucratic in their approach. We are not alone in this. Most solicitors are very frustrated by their dealings with the Legal Services Commission."

In fact it was not Master Gordon-Saker who made the observation attributed by Master Rowley to the case of LXM. The comment was made by His Honour Judge Inglis on an appeal from Master Gordon-Saker in another case called Howarth v Britton Merlin to which Master Gordon-Saker referred in [59]-[63] of his judgment in LXM. That was a case where Master Gordon-Saker had to decide whether adequate information on alternative funding was provided to a client prior to concluding a CFA (not a CFA-Lite) by virtue of the operation of regulation 4 of the CFA Regulations 2000. Mr Williams rightly observes that the issue there was different from the issue in these appeals. Nonetheless, what Judge Inglis apparently said (according to the SCCO case summary) was this:

"The freedom from bureaucracy if it existed was a benefit to the solicitor not the client."

I will return to that observation below, but reference to AHM v Scout Association, a decision of Master Leonard made on 28 January 2015, shows that the solicitor in that case (where a change to a CFA prior to 1 April 2013 was held by the Costs Judge to be reasonable) had advised the client, as one part of his advice, that the LSC was "very bureaucratic, which might cause delay to the case." I have been unable to detect any actual observation by Master Leonard on that assertion in his judgment. In fact the focus of the judgment was largely upon whether there was a realistic risk of the withdrawal of public funding in that case, another matter upon which the solicitor had placed reliance.

At all events, the only purpose of this rather detailed analysis is to note that it does appear that solicitors engaged in this kind of work do complain that they find that the LSC acts in what they describe as a bureaucratic way. It is not for me to say whether that is a fair criticism or not, but if it is advanced by a solicitor with relevant experience in an appropriate case I, for my part, do not think it is merely a concern for the solicitor. The litigation friend of a severely disabled child (usually one of the child's parents), for example, will invariably be frustrated by any delay caused to processing a claim designed to make the life of the child (and indeed the parent) easier. To the extent that Judge Inglis was suggesting that the impact of this factor on the client was of no or minimal significance (and to the extent that Master Rowley was adopting that view), I respectfully disagree. It may be a legitimate factor for the solicitor to raise if it is his/her experience and the client is perfectly justified in taking it into account in deciding whether to change to a CFA.

However, it was not the factor that led to the decision of Master Rowley and I will say nothing more about it. I must return to that factor (the 10% uplift issue) and reach a conclusion upon it.

The central issue in these appeals

The decision whether these appeals should succeed or fail must, of course, be made by reference to the rules applicable at the time the relevant decisions concerning the change of funding occurred and by reference to such authoritative guidance as is available. I have already observed (see paragraphs 56 and 76 above) that the precise situation arising in these cases is unique, is not covered directly by any previous authority and, whilst other cases raising similar issues will doubtless emerge over the next few years, there will be a finite number of cases in which those issues will arise. I will turn to the application of the principles in practice in this context below, but the first issue is whether on a review (which each of these appeals constitutes) I am entitled to intervene at all.

For reasons which will emerge more fully below, I do consider, with respect, that each Costs Judge placed too much weight on the suggested analogy with the informed consent issue in the context of medical treatment (see paragraph 49-55 above). Mr Williams is, in my view, right to say that, in the first place, it over-complicates the issue which, putting it shortly, is simply whether the additional liabilities were reasonably or unreasonably incurred. That question is to be determined by the application of the test in Wraith as explained (to the extent that it needed explanation) in Solutia UK Limited v Griffiths (see paragraph 60 above). That test is, in my view, wholly objective, but applied in the context of the individual circumstances of the particular claimant. In LXM, Master Gordon-Saker articulated the test (at [65]) by saying that the question was as follows: "Was the CFA and the attendant ATE policy a reasonable choice for the claimant at that time, having regard to all the circumstances?" It goes without saying, of course, that "all the circumstances" are those that apply to the individual claimant. Expressed in that way, the focus is not, as Mr Hutton suggested was the effect of Mr Williams' argument, namely, that if there was any reasonable person who might have agreed to the change, that was sufficient, but upon what a reasonable person standing in the shoes of the individual claimant would do.

That test, properly applied, would enable a costs judge to decide whether, in a particular case, the failure to mention the 10% uplift would be likely to have made any difference to the decision to transfer from legal aid to a CFA without any direct evidence from the claimant or the litigation friend. I will return to this below, but I regard the reference to Montgomery as a distraction in this context. I agree that some kind of analogy could be constructed, but there is, in my view, a world of difference between someone being asked to decide on whether to embark on a course of treatment or to approach a particular medical condition in a particular way having been told that there is a percentage chance of an adverse outcome and someone being asked if they are prepared to sacrifice a very small percentage of an overall substantial award of damages for the actual or perceived benefits of transferring to a CFA. Whilst Mr Williams has, in my view rightly, accepted that the 10% issue has to be seen as something that ought to have been mentioned to each of the litigation friends, the failure to do so should, save in very exceptional cases, be a matter for discussion and consideration between the claimant and/or his litigation friend and the solicitors: it is not a matter that should be of concern to the paying party. As I shall indicate below, where the issue does come into the arena in a costs assessment exercise if it ever does, in all but the most exceptional cases I consider that the court can decide if the failure to mention the 10% uplift would have made any difference by applying the Wraith test.

It seems to me, therefore, that the focus of the decision of each Costs Judge was wrongly narrowed by reference to the analogy with Montgomery and, that being so, I am entitled to look afresh at the issue.

There are one or two further preliminary considerations that illuminate how this issue should be seen. First, I cannot, for my part, see why there could have been any complaint on the part of the defendants in these cases if each claimant had signed up to a CFA-Lite from the outset. If that is correct, why, one asks rhetorically, should changing to a CFA-Lite at some stage down the line be any different? Second, and allied to that first point, is this consideration: the government decided to alter the recoverability arrangements and this was heralded well in advance of 1 April 2013. If Parliament had wanted to prevent solicitors "taking advantage" of the old system before the new system came into operation on that date, it could have included some kind of "anti-avoidance" provision in LASPO. It did not do so. Third, and again allied to those two points, Mr Hutton contended that these appeals had been brought "in the financial interests of Irwin Mitchell (and possibly the ATE insurer) alone, and the claimants have no interest at stake in it." I did question this assertion and Mr Hutton said expressly that he was not suggesting that was anything illegitimate or "money grabbing" about what occurred. He accepted that the pre-1 April 2013 system was designed to reward solicitors in cases where the success fees were payable for those cases where costs were not recovered, but suggested, as I understood him, that the timing of the transfer to a CFA in each of these cases meant that this was not the motive. As to that, he may be right, but for my part I do not see why that could not have been the motive and, if it was, that there was anything wrong about it. If the solicitor was "playing the system" within the prevailing rules, I have difficulty in understanding why there was anything wrong about it such that complaint could be made at the costs assessment stage.

The principles and practice to be applied to this issue if it arises should, in my judgment, be informed by the need to ensure that detailed assessments of costs do not become an arena for a wide-ranging inquiry into the decision-making processes as between the claimant (usually, through his or her litigation friend) and his or her solicitors. Inevitably, any such inquiry would involve a number of logistical problems, one being the privilege accorded to communications between a litigant and the litigant's legal adviser. There was a distinctly unhappy period in the early stages of CFAs during which defendants sought to challenge (and indeed in some cases did so successfully) the validity of the CFAs entered into by reference to the adequacy of the advice received prior to the entry by the claimant into the relevant CFA. It is worth recalling it briefly.

The Conditional Fee Agreement Regulations 2000 imposed obligations on solicitors to inform clients of certain matters before entering into a CFA. A material breach of the regulations rendered the agreement unenforceable: see Hollins v Russell [2003] EWCA Civ 718. On detailed assessment paying parties would seek to establish that the solicitors for the receiving party had failed to comply with the regulations, that the CFA was thereby unenforceable and that the receiving party, not being liable to pay his own solicitor's costs, could not recover them from the paying party. This was part of the "costs war" described by Sir Rupert Jackson in section 5(iv) of Chapter 3 of his Preliminary Report.

The issue of whether the solicitors had complied with the regulations became the subject of witness statements produced for the detailed assessment hearing. Statements would be produced from the solicitor and also from the lay client. This could include the widows of deceased husbands and the parents of severely disabled children. Master Gordon-Saker has advised me that there were occasions he recalls when paying parties required such witnesses to attend to be cross-examined. An example from his own experience was Puksis v Brumby [2008] EWHC 90095 (Costs) in which the defendant required the mother and litigation friend of a claimant who had suffered severe head injuries in a road accident to attend court to be cross-examined about the inquiries that the claimant's solicitor had made as to the existence of other means of funding the claim. In an intervention during the hearing of these appeals, Master Gordon-Saker characterised the period prior to the Conditional Fee Agreements (Revocation) Regulations 2005, which stopped this type of challenge for CFAs concluded after 1 November 2005, as "the bad old days".

Without sacrificing entirely the possibility of a proper challenge to a changed funding arrangement that is demonstrably improper or seriously prejudicial to a defendant for no good reason, any return to such days must be resisted strongly. Master Rowley said in Surrey (see paragraph 51 above) that the absence of any evidence from the Litigation Friend in relation to the 10% uplift "speaks volumes". I do not, of course, possess anything like his experience in these matters and, accordingly, I differ from his view with considerable diffidence. However, I would be inclined to be less robust in my attitude to this particular omission. The claimant's litigation friend was his mother (and thus the mother of a severely disabled child) who would doubtless have been relieved that the claim for her son had been resolved satisfactorily when the settlement was finally approved by the court. She will have walked away from that hearing thinking that she could forget the litigation and get on with the life that she and the rest of her family had to contemplate. The putting forward of any statement by her in relation to this issue may have led to a request that she should give evidence at the costs hearing. If that occurred it really would be a return to the "bad old days" and one wonders what truly useful evidence on the issue in question she could possibly have given.

Detailed assessment hearings should, in my judgment, be kept as simple and straightforward as possible so that the Costs Judge can focus upon and deal with (robustly if necessary) the real issues concerning the costs sought that traditionally arise. It must, in my view, be a wholly exceptional case where, for example, the litigation friend of the kind I have identified should ever be required to attend to relive one decision made in the litigation that probably did not seem a particularly difficult or important one at the time. Mr Hutton has emphasised that the NHSLA would not seek to put anyone in this position unless it felt it was truly necessary to do so. I accept that unreservedly. The NHSLA has a difficult path to steer between defending robustly allegations of negligence that are unfounded, or at least properly defensible, and simply "giving in" to such allegations when made. Equally, when responding to the quantum element of a claim once liability and causation have been conceded or established, it plainly has a duty on behalf of the public purse to ensure that claimants do not receive more than the entitlement for which the law provides, but equally it needs to deal sensitively with claims made by families whose lives have been changed forever by (often) some relatively short-lived negligence. History shows that where concessions concerning liability and causation are necessary, the NHSLA does indeed make such concessions on behalf of those it represents (where appropriate, at an early stage) and suitable apologies are offered. This is plainly a responsible approach. In relation to damages, the availability of periodical payments orders has made it easier in many cases for appropriate settlements to be achieved satisfying both sides and the NHSLA has shown itself willing to engage constructively when discussing the disposition of a damages award. I am sure it is the case that the majority of claims are settled following roundtable meetings and this reflects a responsible and responsive attitude on both sides. As I say, I have no doubt that the NHSLA would not pursue the kind of hearing to which I have referred above if it was of the view that it was not properly necessary.

However, whether such a hearing is appropriate cannot be left to one party alone: the court must plainly retain control over the way in which detailed assessment hearings are conducted and whether such a hearing as that foreshadowed above is necessary must ultimately be a decision for the court. I will say a little below (see paragraph 110) about the practice I suggest is followed in these cases henceforth having received the advice of Master Gordon-Saker.

So where do these considerations and established authority lead? If this issue arises, in my view, a Costs Judge is perfectly entitled, possibly using his or her experience of other cases or their experience from days in practice, to ask and, in most cases, answer the question of whether the omission to refer to the 10% uplift would have made any difference to a reasonable claimant or his litigation friend in the circumstances prevailing in that case without receiving evidence on the issue. However, this question should be seen from the perspective of asking whether a reasonable claimant or reasonable litigation friend, in the circumstances prevailing in the case, would see the possibility of obtaining X +10% of X rather than X in the context of the overall global settlement as a matter that would prevent the change to a CFA. In Surrey, taking £19,000 as the value of the 10% uplift and the capitalised value of the settlement as £7,165,255, the question is whether a reasonable claimant or litigation friend in that situation would hold out for obtaining an increase of 0.026% of that sum rather than to have the uncertainty of the possible effect of the statutory charge, the possible effect of Part 36 offer and possible delays that might be overcome by being answerable to an insurer rather than the LSC. Whilst it would be possible to try to quantify those matters, the reality is that a solicitor would almost certainly put them forward in a broad way and invite the claimant or the litigation friend to approach the issue accordingly.

When looked at in that way, I do not believe that any reasonable claimant or litigation friend would hold out for such a marginal improvement on the overall settlement. In Yesil the percentage increase would be just under 0.4% (taking £24,000 as the 10% uplift). In AH it would be somewhat higher at 5%. However, that case was, as I have said, extremely tragic and I cannot believe that the claimant's litigation friend would have wanted anything other than a quick and simple resolution and would not have seen an additional £17,500 as worth pursuing.

I say all this from the perspective of having seen in my full-time judicial capacity over the last nine years many Opinions from Leading and Junior Counsel across the country advising on the acceptability of a proposed settlement in this kind of litigation. I bring to bear also my own experience as a practitioner when I represented both sides in clinical negligence litigation. The Opinions that I have seen are invariably very detailed and often descend to quite closely calculated arithmetic. However, at the end of the day, there are many elements of the claim (including the damages for pain, suffering and loss of amenity) where a broad brush discount is applied to reflect the risks of litigation. This is a wholly familiar feature of these cases for those who practise in the field. No reasonable litigation friend would, in my view, hold out for the kind of figures in the kind of circumstances arising in each of the three cases under appeal even if only told of the general advantages of moving to a CFA. Approached in this relative way, rather than looking at the absolute figure involved, is, in my judgment, more likely to lead to a common sense result which in the vast majority of cases would be that the failure to mention the 10% uplift would have made no difference applying the Wraith test.

Applying that approach to each of the three cases the subject of these appeals, I would respectfully differ from the conclusion reached by each of the Costs Judges and would restore in principle the additional liabilities they disallowed. I will deal with the subsidiary issue concerning the ATE premiums below (see paragraph 111-120).

I have, of course, focused on what, in my view, will be a tolerably easy decision for a Costs Judge in the vast majority of cases if told that the 10% uplift issue is a "live" issue. There may be a small residue where the decision is not so clear or where there is a suggestion of some impropriety in relation to a switch from Legal Aid to a CFA. It is difficult to see what they might involve, but any system must provide for a way in which they are to be identified and resolved. Under the practice proposed below, that possibility is preserved.

The practice in future

The procedural framework for the way in which what I have termed the "Simmons v Castle 10% issue" should be dealt with in future is summarised as follows:

(i) In any case in which the claimant changed funding from Legal Aid to a CFA in the period from 26 July 2012 (the date of the first judgment in Simmons v Castle) to 1 April 2013, the claimant's solicitors should state in the narrative to the bill whether or not before the CFA was entered into the claimant or his/her Litigation Friend was advised of the 10% uplift. The solicitor's certificate that the bill is accurate will apply to that statement.

(ii) The court will go behind that certificate only if there is a genuine issue as to whether what is stated is accurate. In the event that there is a genuine issue, that should be raised in the points of dispute and the reasons for the issue explained clearly. If the court accepts that a genuine issue has been raised, the question of whether or not advice was given should be resolved at the detailed assessment hearing either by production of the claimant's solicitor's attendance note of the advice or by a short witness statement from the claimant's solicitor. It should never be necessary to adduce evidence from the claimant or the litigation friend. Furthermore, it is difficult to anticipate any circumstances in which it would be helpful for the claimant's solicitor to be required to attend for cross-examination.

(iii) If in a case where the advice was not given the defendant wishes to argue that the change from legal aid to a CFA was unreasonable, that argument must be raised in the points of dispute. In the event that the argument is pursued, the claimant's solicitor should indicate the actual or presumed value of the 10% uplift in the replies together with any reasons relied on as to why the change was reasonable. To the extent that it may not be apparent from other material, the claimant's solicitor should also indicate the capitalised value of the agreed award or of the award of the court following a contested hearing.

(iv) If the issue falls to be determined at a detailed assessment hearing, the Costs Judge should endeavour to reach a decision based on the arguments raised in the points of dispute and replies without any need for further evidence. Evidence as to what the claimant may or may not have done had the advice been given will not be helpful, given that the question for the court is whether the decision was reasonable in the way set out in this judgment. It would only be in the most exceptional case, where there is some suggestion of impropriety, that any oral evidence from any party should be considered. The Costs Judge should give careful directions concerning the reception of such evidence if it should be necessary.

The ATE premiums in Surrey and AH

In Surrey and AH the Costs Judge said that if the ATE premium had been allowed as recoverable in principle, he would have made a reduction in its amount. In Surrey, the reduction proposed was from £50,681 to £31,800; in AH it was from £18,881.78 to £15,000.

The insurance policy was the same in each case and was a block-rated policy – in other words, a policy used in a wide variety of claims and with generic indemnity limits. The policy is self-insuring. It was effectively an "off the shelf" policy used by Irwin Mitchell in many cases. It provided cover of £500,000 in respect of the legal costs of the other side and the disbursements on the claimant's side. The policy excluded cover for "[any] disbursements or opponent's legal costs relating to legal work not within the scope of your CFA." It follows that it would not cover any opponent's costs incurred in the period before the date of the CFA when the claimant would have costs protection afforded by the Legal Aid certificate. The premiums are staged: Stage 1 relates to the pre-issue period. This is not relevant to these cases because it had expired before the policies were purchased. Thereafter the Stage 2 premium is £17,813 plus tax of £1,068.78 (total £18,881.78) if the claim is won after proceedings are issued and before 90 days before the trial/trial window. Stage 3 applies if the case is won within the period after 90 days before trial/trial window. The premium for this stage is £47,813 plus tax of £2,868.78 (total £50,681.78).

The background to this issue (including the relevant authorities) can be seen from the judgment of Master Rowley in Surrey. He said this:

"103. The claimant purchased a LitigATE policy underwritten by Allianz and for which Irwin Mitchell have delegated authority. It is a block rated policy and so needs to cater for cases which have barely started as well as cases such as this one, where liability has been conceded and the risks have reduced.

104. Mr Hutton sought to persuade me that I should not take Rogers v Merthyr Tydfil County Borough Council [2006] EWCA Civ 1134 as a bar to considering the reasonableness of the premium. Mr Hutton relied on the decision of HHJ Holman sitting in the Manchester county court in the case of Beasley v St Thomas's Priory Golf Club (21 August 2008). It is one example of cases where the judiciary have felt themselves able to take a different view from the underwriter notwithstanding the exhortations of the Court of Appeal in Rogers (quoting Lord Hoffman in Callery v Gray [2002] UKHL 28) that costs judges should be cautious about taking any contrary view, other than in broad terms.

105. I have no doubt that I can take a contrary view to the underwriter if the risk assessment or the level of cover has manifestly resulted in an overly high premium being claimed. But Rogers is very clear authority that the court should be slow to adjust block rate premiums in particular. There are inevitably swings and roundabouts with such premiums and it is not appropriate in my view to be trying to deconstruct the premium here in the way that Mr Hutton sought to persuade me to do.

106. The only aspect which demands some scrutiny is the level of cover which is £500,000. That is considerably higher than the usual block policy in my experience. It also provides, in my view, considerably more cover than can be required in the great majority of cases. It is well known that the higher levels of cover cost little in terms of premium compared with the cover at the bottom since the higher levels are rarely called upon. It is also well known that one of the purposes of setting a higher level of cover than would be needed in most cases under a delegated scheme is in order to make it administratively simpler.

107. I was referred to the case of Finney v Secretary of State for Health, a case heard on 4 February 2015 in the County Court at Hull by District Judge Besford who is a regional costs judge. DJ Besford was persuaded that the level of cover was appropriate. However, he interpreted the wording of the policy to mean that only a stage 3 premium was payable which was £31,800 rather than the £50,681.78 claimed.

108. The circumstances of this case and the case of Finney are identical in that the policy was taken out after liability had been concluded. I do not consider that the policy wording deals with this situation. The description of the start date, in my view, only contemplates a policy being taken out at the beginning of the claim. I regret to say that I do not entirely follow why DJ Besford considered that the policy leapt straight into stage 3, nor that the premium for the earlier stages was not also recoverable.

109. Be that as it may, it does seem to me that the premium allowed by DJ Besford would be a reasonable and proportionate sum to allow in this case. I do not think that it was reasonable to take out a level of cover more than around £250,000 on a block rated basis. Higher levels of cover will be required by so few cases that to include such cover in every policy is not a reasonable cost in my judgment. Very few firms have delegated authority schemes above £100,000 and £250,000 is about the maximum of the policies that I have seen."

In AH the Costs Judge said this on this issue:

"83. The premium is claimed at £18,881.78, block rated. Stage two of three stages was reached. Mr Hutton argues that that figure is too high given that it produced a level of indemnity of £500,000 in circumstances were, for part of the claim, the claimant had costs protection under legal aid. He draws attention to the allowance by Master Rowley in Surrey, where the court decided that cover of around £250,000 on the block rated basis was appropriate. On a broad brush approach, Mr Hutton submits that £12,000 would be reasonable for the premium.

84. Mr Marven emphasises that stage 2 had been reached and that, with the expectation of a trial lasting 5 to 7 days, and several experts on both sides, the level of indemnity was realistic. Moreover, in Surrey, stage 3 had been reached, which is not position here. Finally, Mr Marven draws my attention to the authorities that the onus is on the paying party to produce evidence as to the unreasonableness of the premium (Kris Motor Spares Ltd v Fox Williams [2010] 4 Costs LR 620) and the court should be slow to adjust block rate premiums (Rogers v Merthyr Tydfil County Borough Council [2007] 1 Costs LR 77).

85. I agree with Mr Marven that when the premium is challenged, the paying party must produce material to support any attack on its level. Here there is none. That said, given the fact that the claimant had legal aid protection for the costs for part of the case, I consider there should be reduction to reflect this and also for the fact that at £500,000, the level of indemnity was too high. I would allow £15,000."

Mr Williams submits that I should not be influenced by these views and should allow the premiums in full. There was, he submits, no evidence by virtue of which the Costs Judges could make an assessment of any reduction in the premium and relies upon the approach of the Court of Appeal in Rogers v Merthyr Tydfil CBC [2007] 1 WLR 808 (followed by Simon J, as he then was, in Kris Motor Spares Limited v Fox Williams LLP [2010] 4 Costs LR 620). I will set out that approach as it appears in Rogers at [117]:

"If an issue arises about the size of a second or third stage premium, it will ordinarily be sufficient for a claimant's solicitor to write a brief note for the purposes of the costs assessment explaining how he came to choose the particular ATE product for his client, and the basis on which the premium is rated-whether block rated or individually rated. District judges and costs judges do not, as Lord Hoffmann observed in Callery v Gray (Nos 1 and 2) [2002] 1 WLR 2000, para 44, have the expertise to judge the reasonableness of a premium except in very broad brush terms, and the viability of the ATE market will be imperilled if they regard themselves (without the assistance of expert evidence) as better qualified than the underwriter to rate the financial risk the insurer faces. Although the claimant very often does not have to pay the premium himself, this does not mean that there are no competitive or other pressures at all in the market. As the evidence before this court shows, it is not in an insurer's interest to fix a premium at a level which will attract frequent challenges."

This guidance was, of course, itself given in 2006 and was based upon the observations of Lord Hoffmann in Callery v Gray given in 2002 when the new arrangements concerning CFAs were in their relative infancy. That does not diminish the importance of the guidance, but it must be recalled that there is now some 10 years of experience gained by Costs Judges since Rogers. Neither Callery v Gray nor Rogers expressly holds that an adjustment of a premium by Costs Judge should not be made on a broad brush basis, but each, in effect, urges caution in doing so.

There are two reported instances where the broad brush has been applied in this context: Redwing Construction v Wishart [2011] 2 Costs LO 212, a decision of Akenhead J in the TCC and Kelly v Black Horse Ltd (27 September 2013), a decision of the then Senior Costs Judge, Master Hurst. I am particularly influenced by the fact that Master Hurst, whose experience in this field is unrivalled, should have felt entitled to intervene in this way.

Plainly, the application of any broad brush must not be a capricious exercise, but the experience gained by Costs Judges over the years must, if they are to retain the ability to engage in a robust analysis of competing arguments at costs assessment hearings, be permitted to enter the arena. It follows that, in my judgment, each of the Costs Judges would have been entitled to intervene by reducing the amounts recovered in respect of the ATE premium.

The basis of the approach of Master Rowley in Surrey is clear from the quotation from his judgment set out above: he considered that cover for £500,000 in the circumstances was disproportionate. I agree. The claimant would have had costs protection until 15 March 2013 after which he no longer had Legal Aid. Cover under the policy commenced on 22 March 2013, liability having not been in dispute for 3 years. The trial window for the assessment of damages was between June and November 2013. What was claimed was the Stage 3 premium, but the cover was for a short period and the only real risk was a failure to beat a Part 36 offer. There was ample scope for an adjustment and Master Rowley used his own experience and that offered in the case of Finney to arrive at what he considered an appropriate recovery. I would not interfere with that assessment.

In AH, again the Costs Judge felt that cover of £500,000 was too much and made the reduction to £15,000 for this reason. In that case the claimant had costs protection under the Legal Aid Certificate until 1 March 2013 and cover under the policy commenced on 27 March 2013. Settlement was not achieved until December 2013 and there had been no concession on the issue of causation. The case had not been listed for trial. On that basis it is arguable that there was less justification for intervention than in Surrey, but it would not be right for me to interfere simply because others might have reached a different conclusion. The decision was made by an experienced Costs Judge who will have a much better "feel" for this matters than a judge who deals with this kind of issue intermittently. This is an approach reflected in the judgment of Buckley J in Mealing McLeod v Common Professional Examination Board quoted at paragraph 47.21.1 of Volume 1 of the White Book. It follows that I would not interfere with the assessment of the Costs Judge.

Conclusion

The appeals will, accordingly, be allowed in each case save that the sums allowed by way of recovery in respect of the ATE premiums in Surrey and AH will be in the sums the respective Costs Judges said they would have allowed had recovery in principle been permitted.

I should record my indebtedness to all Counsel for their assistance and to Master Gordon-Saker for his most helpful advice. As to the latter, I emphasise, of course, that the decisions reached are mine and mine alone.