United Kingdom House of Lords Decisions

LORD CLYDE'S OPINION.—This application for judicial review concerns the extent to which a solicitor may be entitled to payment from the Legal Aid Fund in respect of advice and assistance which he has given to a client. Between January 1988 and February 1989 the petitioners, who are a firm of solicitors, gave advice and assistance to a client. Legal aid for such advice and assistance may be available under the provisions of the Legal Aid (Scotland) Act 1986. [His Lordship then quoted the terms of sec. 10 as set out in the rubric and continued thereafter.]

On 2nd March 1988 the petitioners applied for an increase in the authorised expenditure to a total expenditure of £150. The request was received by the Legal Aid Board on 4th March 1988 and granted by the Board on 15th March 1988. The decision was intimated to the solicitors by returning the application form with part of it completed to show authorised expenditure increased to £150. The petitioners made a second application for an increase up to £250 on 1st August 1988. This was received on 3rd August 1988 and granted by the Board on 8th August 1988. In due course the petitioners submitted their account to the Board. It came to a total in excess of £250 but they restricted their claim to £250. It appears that the petitioners had continued to provide their client with advice and assistance to an extent which exceeded the standing limit which was authorised before receiving the subsequent authorisation for an increase from the Board. The Board refused payment of the whole sum claimed by the petitioners, evidently on the ground that the Board was not bound to pay in respect of expenses incurred in excess of the authorised limit prior to the increase being authorised. The matter was referred to the joint auditor of the sheriff court for taxation under the relevant regulations. He taxed the account at £222.24, sustaining the representations of the Board. It is agreed that that is the correct amount of work done between the date of the exceeding of the standing limit and the date of the authorisation of the increase is excluded. Otherwise it is agreed that the proper sum should be £250.

It is against that decision of the auditor that the present application has been brought. The auditor has not entered the process but the Legal Aid Board has appeared to oppose the application through their quite proper concern that they should not pay anything out of the Legal Aid Fund outwith the provisions of the relevant legislation. What is claimed here is that the auditor has erred in law in his construction of the legislation. The reference to the auditor for taxation was made under reg. 17 of the Advice and Assistance (Scotland) Regulations 1987. That regulation prescribes that the auditor shall tax the fees and outlays allowable to the solicitor in accordance with reg. 16 "and such taxation shall be conclusive of the fees and outlays so allowable". The challenge, however, made by the petitioners is that the auditor erred in his understanding of the provisions applicable to the taxation. The error which is claimed is one which appears to go to the auditor's jurisdiction and one accordingly which can properly be open to judicial review. The application is thus competent and indeed the competency was not challenged by the respondents.

The auditor appears to have based his decision upon a construction of sec. 10 of the Act. He says:

"It seems to me that giving a proper construction to section 10 of the Act it is incumbent upon the solicitor for the assisted person to consider carefully the likely cost of the work to be carried out on behalf of an assisted person. It seems to me also that the said section contains a specific and express admonition to the solicitor for the assisted person not to proceed to incur addition[al] expense without obtaining approval from the Legal Aid Board. It seems to me that to give any kind of realistic meaning to that section this must have the result that the approval of the Board must be sought before the expenditure is incurred."

I find no precise statement as to how the auditor thought the section ought to be construed but I read his view as being that a solicitor would require absolutely to cease acting as soon as the statutory limit on expenditure was reached. That indeed was the principal contention advanced before me on behalf of the Board.

I should be reluctant to affirm such a construction unless no more reasonable interpretation was available. Taking the wording at its face value, it imposes a prohibition on a solicitor from carrying out his professional work in relation to the particular client. I cannot accept that Parliament intended an absolute interruption of the service being rendered. It may be that in many or most examples in practice a solicitor could anticipate well in advance whether and how soon the statutory limit would be exceeded. But I cannot exclude the possibility that cases could occur where through some unexpected development or some other not readily foreseeable cause the limit might suddenly be reached and passed. No doubt in practice the Legal Aid Board will be ready and able to respond very quickly where the limit required to be passed and the matter was of urgency but the usual period for processing the application for an increase will probably extend over several days and it seems to me that Parliament cannot have intended by sec. 10 that the solicitor was compelled peremptorily to terminate his work regardless of any potential loss which his client might suffer through his failure to continue acting until the Board gave approval for him to continue. A construction of the section which involves a peremptory cessation of the solicitor's services seems to me unreasonable. Furthermore, I note that there is no evident sanction for a failure to comply with the provisions of the section. That to my mind points away from such a construction. Finally such a construction does not seem to me consistent with the intention of this legislation. What the legislation seeks to do is to extend the availability of legal services to the poorer members of society. While one can understand that there must be safeguards against unnecessary expenditure, interruption of the solicitor's services which can be the consequence of the peremptory interpretation seems to me out of line with what the Act seeks to achieve.

Counsel for the petitioners referred to sec. 31 (7) which provides that the relationship between solicitor and client and their respective rights shall not be affected by the fact that services are given by way of legal aid except insofar as expressly provided by the Act. But the allowance for that exception weakens the inference which might otherwise be drawn from the subsection. There could be a question whether sec. 10 contains such an express provision. Indeed counsel for the Board appeared to be accepting that it did when he suggested that sec. 10 could provide a defence against a claim by a client based on a failure to act by the solicitor. But this is but to state the problem of the construction of sec. 10 in a different way. Counsel for the Board also submitted that the intervention of a delay in the giving of the service during the making of an application for an increase would not prejudice the relationship between the solicitor and the client. But the construction of the section which involves the solicitor in a situation where in the course of giving reasonable and necessary advice to a client he requires absolutely to break off the service and do nothing more because, as it were, the meter which measures the cost of his fees and outlays has reached the prescribed limit, seems to me artificial and unacceptable. It was accepted that if the cost was in respect of matters which would in any event be authorised by the Board the result would be the same whether the authorisation was given in advance or retrospectively. There would be no practical difference to the Legal Aid Board at the end of the day, nor indeed to the solicitor when his account came to be paid. In such circumstances a construction of the legislation which excludes the retrospective effect of approval is the less attractive. Counsel for the Board argued under reference to Shop and Store Developments Ltd. v. Commissioners of Inland Revenue [1967] 1 A.C. 472 at p. 493, that desirability should not be taken as a guide to the solution. But the observations of Lord Morris of Borth-y-Gest to which he referred relate to the matter of applying particular statutory language to particular facts as found. The problem in the present case is to ascertain what the particular statutory language means. Counsel also pointed out under reference to Craies, Statute Law (7th edn.), pp. 70–71, that the obvious and plain meaning of the statute should not be departed from. But I do not regard the meaning of sec. 10 to be plain or obvious. Counsel for the petitioners referred to Maxwell, Interpretation of Statutes (12th edn.), p. 45, to support an interpretation which would secure the purpose of the legislation rather than make it futile. But the distinction here seems to me rather to be one between the reasonable and the absurd.

Something of the argument touched on the question whether the word "prior" should be read into the section before the word "approval". Counsel for the petitioners at times attached some importance to this approach and from the terms of the auditor's note which I have quoted, and in particular his underlining of the word "before" in that quotation, it seems that he considered that that was a, or even the, critical issue. I am not persuaded that that is the true question. Section 10 does not by itself seem to me to be immediately directed to the payment by the Board of the solicitor's fees and expenses. It provides that the solicitor shall not give the advice and assistance, not that he shall not be paid for it. I find it difficult to read into the section some such explanatory qualification as that he shall not give the advice and assistance if he wants to be paid by the Legal Aid Board. Counsel for the Board argued that the presence or absence of the word "prior" was neither here nor there, but his interpretation of the section also brought in consideration of entitlement to payment. He submitted that the consequence and indeed the sanction if the solicitor breached the section was that he would not be paid for his work. But that seems to me to be going too far beyond the words of the section. A more sophisticated form of that approach was suggested by counsel for the Board in an argument that the words "advice and assistance … provided to a client" meant advice and assistance which would be paid for by the Legal Aid Board. The argument is that while "advice and assistance" is defined quite generally in sec. 6 (1) the word "client" is defined as a person who seeks or receives advice and assistance in accordance with Pt. II of the Act and sec. 8 provides that advice and assistance to which that Part applies shall be available for any client whose income and capital fall below certain specified limits. I am not persuaded that even following this route sec. 10 should be construed as restricted to legally aided advice and assistance so as to infer an absolute prohibition on the solicitor in respect of actings within the Legal Aid Scheme but leaving him free to act outwith it with no prospect of payment from the Board. I do not consider that reference to the definitions achieves that result and, if the section intended that, it could easily have said so. The view which I reach is that sec. 10 is not peremptory but is simply directing what the solicitor should do. It does not follow that if he exceeds the limit he will not be paid by the Board. Thus the presence or absence of the word "prior" does not seem to me to be crucial.

What the petitioners claim is an entitlement to be paid the full sum which the Board eventually approved, namely £250, even though some of the work was done at a time when the existing limit had been passed. As they aver in para. 8 of the petition under reference to the Advice and Assistance (Scotland) Regulations 1987:

"In terms of the said regulations, the petitioners were entitled to have their account taxed on the basis that they were entitled to payment in respect of inter alia the work done by them prior to the approval of the Board of the increase in authorised expenditure."

I turn accordingly to the provisions relating to their entitlement to payment.

Section 12 (3) of the Act of 1986 provides that except insofar as regulations otherwise provide, a solicitor's fees and outlays shall be paid out of a succession of sources of which the last is the Legal Aid Fund. The fees and outlays in question are those which are properly chargeable under sec. 33 of the Act in respect of advice and assistance given to a client in pursuance of Pt. II of the Act. Section 33 provides that the fees and outlays of a solicitor providing advice and assistance under the Act shall be paid out of the Legal Aid Fund in accordance with sec. 4 (2) (a) in respect of any fees or outlays properly incurred by him in so acting. Section 4 (2) (a) provides that sums due to a solicitor in respect of fees and outlays properly incurred by him in connection with the provision in accordance with the Act of advice and assistance shall be paid out of the Fund. Section 33 (2) also provides for the making of regulations in respect of fees and outlays. The regulations which were said to be relevant are the regulations to which I have already referred, namely the Advice and Assistance (Scotland) Regulations 1987. Some of the first few of these regulations relate to the disposable income and capital of the client and his eligibility for legal aid. Regulation 7 provides that the solicitor shall only give advice and assistance in pursuance of Pt. II of the Act if he has satisfied himself that the client is eligible to receive advice and assistance under the Act and the regulations. It does not state that he will not be paid if he does not do so. By contrast reg. 10 provides expressly that if the solicitor fails to send to the Board the client's application for assistance within the specified time-limit, his fees and outlays shall be ineligible for payment in terms of sec. 12 (3) of the Act unless the Board finds special reason to excuse the failure. Regulation 16 (1) provides that subject to para. (2) the fees and outlays allowed on assessment and taxation mentioned in regs. 17 and 18 shall only be fees for work necessarily and reasonably done and outlays reasonably and necessarily incurred. Paragraph 16 (2) states that:

"The fees and outlays allowable to the solicitor under paragraph (1) above shall not exceed the limit applicable under section 10 of the Act as read with Regulation 11."

Regulation 11 (1) provides that where at any time it appears to the solicitor that the cost of giving the advice and assistance is likely to exceed the limit applicable he shall apply to the Board for its approval to an increased limit. Paragraph 11 (2) provides that the Board if it approves such an application shall authorise such increased limit as it thinks fit and may impose certain conditions and limitations on the subject-matter as it thinks fit.

Regulation 11 is framed in terms which envisage that the application is made at a stage at which the limit has not been exceeded, because it proceeds on the eventuality of it appearing to the solicitor that the limit is likely to be exceeded. But this subjective test, which echoes that in sec. 10 of the Act, leaves open the possibility that the exceeding of the limit may not become evident in time. In my view the regulation can also cover a case where the limit has been passed so as to enable a solicitor to apply for an increase in a situation where the likelihood, even if appreciated, has become a certainty. Correspondingly, it seems to me that the Board's approval of such an application and authorisation of the new limit should be available to cover all work necessarily and reasonably done up to that new limit. Regulation 16 (2) provides that the fees and outlays are not to exceed the prescribed limit. It does not provide that any incurred prior to the limit being prescribed and in excess of an earlier limit are to be excluded. The fees and outlays in question seem to me to be fees and outlays incurred at any time provided they satisfy the requirement of reg. 16 (1) of being reasonable and necessary and the other provisions of that paragraph. The limit referred to in reg. 16 (2) is the limit prescribed under sec. 10 and reg. 11, and it is the same limit whether or not the application for an increase has been made before or after the original limit has been exceeded.

Counsel for the petitioners referred to the legislation prior to the Act of 1986 and the Regulations of 1987, namely the Legal Advice and Assistance Act 1972 and the Legal Advice and Assistance (Scotland) Regulations 1973. Section 3 of the Act of 1972 corresponds with sec. 10 of the Act of 1986. Regulation 5 (5) of the Regulations of 1973 corresponds with reg. 11 (1) of the Regulations of 1987 but where the latter require the solicitor to apply to the Board "for its approval", the earlier regulation required him to apply "for prior authority". Counsel also pointed to other examples of the use of the phrase "prior approval" or "prior authority" in the legislation to support his argument that the word "prior" was not to be implied in sec. 10 of the Act nor in reg. 11. Counsel for the Board submitted under reference to Farrell v. Alexander [1977] AC 59 at p. 73, that the Act of 1986, whether or not it was a consolidating statute, should be interpreted "without recourse to antecedents," if reasonably possible. Certainly I would not base my decision on consideration of the prior legislation but on the statute and regulations which apply to the present case. But, in any event, as I have sought to explain, the issue of the presence or absence of the word "prior" does not seem to me to touch the critical issue.

It is obviously the intention of the legislature that solicitors should apply for an increase in the limit as soon as it becomes evident that the cost of their services is going to increase the permitted limit. Provided they do so, they may have the means of knowing before they exceed the limit whether or not the Board will pay for services given to a value in excess of that limit and what that excess is to be. If they do not make the application timeously they are running a risk because they will not know whether the Board will or will not authorise payment. If the Board does authorise an expenditure over the limit, then the services which they have provided may be paid for. But the Board is not bound to approve the application, nor is it bound to approve it to the extent sought. Moreover, if it does approve an increase, it may add conditions which it will be too late for the solicitor to meet. Regulation 16 seems to me to provide a sufficient safeguard to the Board in importing the standard of what is reasonable and necessary and the overall limit which it authorises. I see no justification for a construction which somehow imports an exclusion of work done before the authorisation is granted. So, while it is not incompetent for the solicitor to apply after the limit is past and it is not beyond the powers of the Board to authorise an increased limit applicable to all the work properly done by him, it is obviously unwise for the solicitor to delay in making his application for an increase at the stage at which in terms of sec. 10 he is directed to do so.

The legislation does not seem to me to be of great clarity but in my judgment the auditor erred in the construction of it which he adopted. It was agreed that if I was to reach that view, I should reduce the decision which he gave on the taxation of the petitioners' account on 6th September 1989 and find and declare that the petitioners are entitled to have their account taxed to indicate their entitlement to a payment of £250. I shall accordingly pronounce decree of reduction and a declarator as sought.

The second-named respondents thereafter reclaimed, the reclaiming motion coming before an Extra Division, comprising Lord McCluskey, Lord Morison and Lord Kincraig, for a hearing thereon on 21st November 1990. Eo die, their Lordships made avizandum. At advising, on 18th January 1991, their Lordships allowed the reclaiming motion, recalled the interlocutor of the Lord Ordinary and dismissed the petition.

LORD MCCLUSKEY .—This is a reclaiming motion against an interlocutor of the Lord Ordinary dated 26th April 1990 in a petition for judicial review of a decision of the auditor of the Sheriff Court, Edinburgh. The decision of the auditor and the interlocutor of the Lord Ordinary reducing that decision derived from the differing interpretations by the auditor and the Lord Ordinary respectively of the effect of sec. 10 of the Legal Aid (Scotland) Act 1986 and the Advice and Assistance (Scotland) Regulations 1987, made by the Secretary of State in the exercise of various powers conferred upon him by the same Act. Before I turn to examine the sharp issue of the meaning and effect of the relevant provisions in sec. 10 it is desirable to consider the background to the legislation.

The Legal Aid (Scotland) Act 1986 made very substantial alterations in relation to the administration of legal aid in Scotland. It also made a number of detailed alterations in relation to the circumstances in which the Legal Aid Fund could properly meet the fees and outlays of lawyers in connection with the provision by them of legal aid in specified court proceedings or the provision of advice and assistance. Until the 1986 Act came into operation, the provision of advice and assistance was governed by the Legal Advice and Assistance Act 1972, which applied both to England and Wales and to Scotland. Section 3 of the 1972 Act provided that there was to be a financial limit upon the cost of giving advice and assistance and made provision for that limit to be exceeded in circumstances specified in the section. Broadly speaking, the relevant wording of sec. 3 in relation to the financial limit is very similar to the wording of sec. 10 of the 1986 Act. It was not, however, suggested by counsel before us that the wording of sec. 3 of the 1972 Act had received judicial consideration either in England or in Scotland and there was, accordingly, no submission that the enactment of the provisions in the 1986 Act had to be looked at in the light of any such consideration. What is plain, as was submitted by counsel for the reclaimers, is that the 1986 Act, albeit it repeats, with minor alterations, many of the provisions of the legislation which it replaced, is not a consolidation statute. By sec. 45 of and Sched. 5 to the 1986 Act the whole of the 1972 Act was repealed. The 1986 Act extended only to Scotland, apart from one provision that has no bearing on the present matter (see sec. 46 (4)). Part III of the 1986 Act deals with "Civil Legal Aid". In the case of civil legal aid the aid is to be made available to a person provided that the Board is satisfied as to the matters specified in sec. 14 and that the applicant meets the financial conditions specified in sec. 15. It is to be noted that sec. 14 (1) (b) provides that civil legal aid is to be available to a person, if "it appears to the Board that it is reasonable in the particular circumstances of the case that he should receive legal aid". Thus the Board has statutory powers to exercise close control over the grant of civil legal aid and, therefore, over disbursements from the Fund. There is, however, a striking contrast between Pt. III dealing with civil legal aid and Pt. II dealing with advice and assistance. Where "advice and assistance" is provided under Pt. II there is no requirement for the solicitor to go to the Scottish Legal Aid Board to show probabilis causa or reasonableness, or anything else of that character. It is the responsibility of the solicitor himself who is approached by a person who seeks to be his "client" under Pt. II to ensure that the person seeking advice and assistance to which Pt. II applies falls within the financial criteria specified in sec. 8. Thus, by contrast with its position under Pt. III, the Board does not have any similar powers of control at the first stage over the grant of advice and assistance to a person who meets the sec. 8 financial criteria. The solicitor's actings in relation to the rendering of advice and assistance are unsupervised by the Board at that first stage. It is in these circumstances that Parliament has enacted sec. 10. In my opinion, the purpose of sec. 10 is to prevent the unsupervised solicitor from providing advice and assistance to a client beyond the specified, and quite modest, limit specified in sec. 10 unless the solicitor first obtains the approval of the Board to exceed the statutory financial limit. It is important to see sec. 10 in its context. The only provisions contained in Pt. II of the Act are the definitions (sec. 6), a section dealing with the application of Pt. II (sec. 7), the section regulating the financial criteria determining eligibility for Pt. II advice and assistance (sec. 8), a section empowering the making of regulations (sec. 9), sec. 10 itself, sec. 11, which regulates contributions by the client towards the cost of the advice and assistance provided to him, and a section (sec. 12) specifying the various possible sources of monies to which the solicitor has to look, and the order in which he has to look at them, in order to be reimbursed for fees and outlays in relation to advice and assistance provided. Thus Pt. II contains no provision, other than in sec. 12 (3), authorising payment in respect of the rendering in terms of Pt. II advice and assistance as defined therein. The payment provisions are elsewhere. I turn to examine them.

Section 33 provides that a lawyer who acts for any person by providing advice and assistance under the Act is to be paid out of the Fund "in accordance with section 4 (2) (a) of this Act in respect of any fees or outlays properly incurred by him in so acting" (my emphasis). Section 33 (2) (b) empowers the Secretary of State to make appropriate regulations in respect of the fees and outlays of lawyers "providing advice and assistance in accordance with Part II of this Act". Section 4, which establishes the Fund, echoes sec. 33 in a material respect by providing:

"(2) There shall be paid out of the Fund—(a) such sums as are, by virtue of this Act or any regulations made thereunder, due to any solicitor or counsel in respect of fees and outlays properly incurred by him, in connection with the provision, in accordance with this Act, of … advice and assistance"

(emphasis added).

It is thus clear that the Board has a duty, in defined circumstances, to make payments out of the Fund of such sums as are due in respect of fees and outlays properly incurred by lawyers in connection with the providing by them of the services which the Act empowers them to provide to persons who are qualified (in financial terms) to receive legally aided services. It is equally clear that the Board has no power to pay out of the Fund any sums which are claimed by a solicitor or by counsel in respect of fees and outlays unless those fees and outlays have been properly incurred by the lawyer in connection with the provision to a "client" (as defined), in accordance with the Act, of "advice and assistance" (as defined). (There are exceptions to that general proposition in sec. 4 (2) (b) and (c)but they have no relevance to the present issue.) It is, in my opinion, quite clear that the Board's liability in respect of fees and outlays claimed by a solicitor or by counsel in respect of the provision of advice and assistance (as defined) to a client (as defined) must stem from secs. 33 and 4 (2) (a). In particular, though it will be necessary to return to it, I wish to emphasise that the relevant parts of sec. 10 make no specific provision for payment of any sums from the Fund or by the Board to anyone. What that section does is to place a ceiling upon the amount that the lawyer may claim in respect of providing advice and assistance, and to enable that ceiling to be raised in specified circumstances.

When it was enacted, and at the time when the respondents in the reclaiming motion rendered advice and assistance under Pt. II to their client, sec. 10 contained the following provisions. [His Lordship quoted same and continued thereafter.]

This section uses the terms "advice and assistance" and "client", being terms defined in sec. 6 (1). Section 6 (1) contains inter alia the following:

"‘advice and assistance’ means any of the following—(a) oral or written advice provided to a person by a solicitor (or, if and so far as may be necessary, by counsel)—(i) on the application of Scots law to any particular circumstances which have arisen in relation to the person seeking the advice; (ii) as to any steps which that person might appropriately take (whether by way of settling any claim, instituting, conducting or defending proceedings, making an agreement or other transaction, making a will or other instrument, obtaining further legal or other advice and assistance, or otherwise) having regard to the application of Scots law to those circumstances; (b) assistance provided to a person by a solicitor (or, if and so far as may be necessary, by counsel) in taking any steps mentioned in paragraph, (a) (ii) above, by taking such steps on his behalf or by assisting him in so taking them."

Section 6 (2) provides inter alia:

"In this part of the Act—‘client’ means a person who seeks or receives advice and assistance in accordance with this Part of this Act."

From the foregoing provisions it is clear that, if a person goes to a solicitor seeking advice on the application of Scots law to any particular circumstances which have arisen in relation to the person seeking the advice, the solicitor, provided he is satisfied that the person falls within the financial criteria set out in sec. 8, is at liberty to provide the advice sought without reference to the Board or indeed to anyone else. However, if it appears to the solicitor that the cost of giving the advice is likely to exceed the statutory limit specified in sec. 10 (2), £50, he has certain responsibilities.

Before examining what those statutory responsibilities are, it is helpful to look at reg. 16 of the Advice and Assistance (Scotland) Regulations 1987. Regulation 16 provides that the fees and outlays allowable to the solicitor are to be fees for work actually, necessarily and reasonably done in c onnection with the matter upon which advice and assistance was given, in accordance with the tables of fees in Pt. II of Sched. 3, and outlays actually, necessarily and reasonably incurred. Part II of Sched. 3 then gives details of the sums that are allowable in respect of time spent or specified activities carried out. It is evident from the tables and the figures that if the solicitor spent one hour with the client and thereafter wrote two or three letters he would be entitled to claim payments totalling just a pound or two short of the £50 limit. That alone is sufficient to make it clear that if the first interview with the client (after his financial eligibility has been established) reveals that the matter upon which the advice has been sought is likely to be complicated and to require more than an hour and a half of the solicitor's time, then it should at once appear to the solicitor that the statutory limit is likely to be exceeded.

It is now appropriate to examine sec. 10 and to consider the solicitor's responsibility. For clarity I shall repeat the essential words contained in sec. 10. They are:

"Where at any time … it appears to the solicitor that the cost of giving it [i.e., advice and assistance] is likely to exceed the limit … the solicitor shall determine to what extent that advice and assistance can be provided without exceeding that limit; and … shall not give it … so as to exceed that limit except with the approval of the Board."

Accordingly, the situation that presents itself to the solicitor is this: having satisfied himself that the person in front of him is financially eligible for advice and assistance under Pt. II, he must, unless it is clear that the matter can obviously be disposed of swiftly and cheaply, address his mind to the question as to whether or not the cost of giving it is likely to exceed the £50 limit. As part of that exercise he has to determine to what extent the Pt. II advice and assistance can be provided without exceeding the £50 limit; and he is told by sec. 10 that he shall not give advice and assistance so as to exceed the limit except with the approval of the Board. As I construe sec. 10, therefore, it imposes upon him two positive duties, (a) to think about the cost of giving advice and assistance and (b) to determine how much of the advice and assistance which he thinks he is likely to have to render can be paid for at a cost of £50 or less. Then he is prohibited from giving Pt. II advice and assistance beyond the £50 limit except with the approval of the Board. Incidentally, it is clear that the approval of the Board is required not simply in respect of the duty of the Board to protect the Fund because the Fund is the last source of monies to which the solicitor looks for reimbursement of his fees and outlays: sec. 12 (3) provides that he looks first to any contribution payable by the client, secondly to expenses awarded, thirdly to property recovered or preserved for the client in connection with the matter and only finally to the Fund. Accordingly, it is a mistake to think of "the approval of the Board" as being a statutory mechanism just to protect the Scottish Legal Aid Fund. The approval of the Board is a mechanism to avoid uncontrolled rendering of advice and assistance creating a consequent liability for fees and outlays. The requirements to ascertain what can be done within the limit and to stop providing assistance beyond the limit without approval by the Board are the only mechanisms of control the Board possesses in relation to the amount of work that the solicitor may perform and charge for in accordance with the Act. If one now returns to consider the terms of sec. 33 and sec. 4 (2) (a) and bears in mind the definitions contained in sec. 6, it is clear that, before the Fund can be made liable to reimburse the solicitor, and indeed before the Board is entitled to reimburse the solicitor out of the Fund, the fees and outlays in respect of which the solicitor claims must have been "properly incurred by him, in connection with the provision, in accordance with [Part II], of … advice and assistance".

What is the point in time when such fees and outlays are "incurred"? Or, to put it another way, at what point in time does the judgment fall to be made as to whether or not they are "properly" incurred? The answer to that must, in my opinion, be that the fees and outlays are incurred when the work is done in respect of which the fee is claimed or the liability to meet the outlay is incurred; and it ought to be possible at that moment to judge if they are being "properly" incurred. That appears to me to be the same point in time as is contemplated by sec. 10 (1) (b), where it is provided that once the solicitor realises that he has gone above the statutory limit he "shall not give" the advice and assistance so as to exceed the limit. At that stage, if he does not have the approval of the Board, he has a choice. He can cease to render advice and assistance until he obtains approval. Alternatively, he can opt to render further legal advice and help to the client; but it will not be "advice and assistance" within the meaning of Pt. II, and the client will not be a "client" as defined in sec. 6 (2); because by giving the legal advice and the help the solicitor has, so to speak, stepped outside sec. 10 (1) (b) which prohibits him from giving Pt. II advice and assistance to a Pt. II client when the cost of doing so will exceed the statutory limit and the Board has not approved. It was suggested to the auditor, to the Lord Ordinary and to us that a solicitor who had initially thought that the cost of giving advice and assistance would be within the limit might face a sudden emergency in which he would require to act quickly but would not be able to obtain the approval of the Board before so acting; and that Parliament could not have intended that he should cease to act or cease to be paid. That scenario would have been more realistic and the argument more persuasive if counsel for the petitioners had been able to suggest any concrete example, but he was unable to provide us with a convincing one. Neither the definition of "advice and assistance" in sec. 6 (1) nor the table of fees allowed by Pt. II of Sched. 3 to the 1987 Regulations is apt to cover the situations which counsel for the petitioners suggested to illustrate the possibility of such emergency. He mentioned, by way of example, the familiar problem of an estranged father and mother doing battle over the custody of or access to a child or the threatened removal by one of them of the child from the jurisdiction. Such matters would normally be dealt with under Pt. II, not under Pt. II. In any event, while it must be accepted that the Board would probably be unable to act over the weekend or during a public holiday, it was not demonstrated that the Board could not act very swiftly if the solicitor sought emergency approval. Indeed, in the present case, without it being suggested that the matter was one of emergency, the Board granted approval within five days of the receipt of an application for approval. However, I accept that it is conceivable that an impecunious person could arrive at a solicitor's office with a problem of such a character that he needed advice and assistance likely to cost more than £50 in circumstances such that he appeared to need a substantial amount of advice and assistance within a short time-span. I turn to consider that possibility in the light of the submissions advanced in this case.

The submissions to the auditor and to the Lord Ordinary seemed to present them with a stark choice. On the one hand, it was urged on behalf of the Board that sec. 10 prohibited the solicitor from giving any legal advice and help to a client whom he had been advising under Pt. II if the cost thereof were going to exceed £50: in other words, the solicitor could not even give his services free or on any other basis. On the other hand, it was suggested by the petitioners that if a solicitor did not at the time think that the cost of giving assistance was likely to exceed the limit but later, when he came to prepare his account, discovered that he had in fact materially exceeded the limit, he was entitled to go to the Board and seek approval for the extra expenditure upon the basis that the work was actually, necessarily and reasonably done in connection with the matter upon which the advice and assistance had been given. This appears to me to have been a false choice. As I read the section there is nothing whatsoever in it which prohibits a solicitor from giving free advice to the client during any period when he has exceeded the statutory limit and does not have the approval of the Board for exceeding it. It would be unfortunate if that were to happen because the solicitor would not be paid; but the statute, having given the solicitor the freedom to act without supervision up to the statutory limit, quite reasonably imposes upon him the burden of ensuring that if the limit is likely to be exceeded he must apply for approval before he is called upon to give advice and assistance over the financial limit. That is acceptable in the generality of cases. I do not see the unusually urgent situation described above as creating some appalling injustice or unthinkable consequence which requires us to give a strained meaning to the wording of the provision. Even accepting, as I do, that it is conceivable that a solicitor could be faced with an impecunious client seeking immediate advice and assistance which would inevitably cost more than the current limit, I do not consider that it is inconsistent with the intention of Parliament, as expressed in the Act, that the solicitor should be faced with the choice of delaying or acting without the benefit of legal aid. It was suggested to us that "what the legislation seeks to do is to extend the availability of legal services to the poorer members of society". I have taken these words from the opinion of the Lord Ordinary who accepted the view as to the intention of the legislation. I accept that the legislation seeks to extend the availability of legal services to the poorer members of society, but it does so under conditions. It is quite wrong to think of legal aid, whether in relation to advice and assistance or in relation to civil proceedings, as being an open-ended system for remunerating lawyers who advise and assist the poor. The actual intention of the legislation as enacted is that some lawyers are to be paid some remuneration for acting in some circumstances for some clients. Within that framework everything else has to be defined and is defined under the statute and the regulations made thereunder. It is not unthinkable that the legislature should have provided that if persons are to receive the benefit of publicly funded legal advice and assistance there should be some safeguard, such as a financial limit, to avoid the disbursement of public funds without adequate controls. Furthermore, I consider that it is a mistake in construing a statute to start off by considering the consequences, real or imagined, of a particular construction and proceeding from that basis to give a construction to the words of the statute. The proper starting-point is the words contained in the statute. In my opinion, the provisions which I have examined are clearly to the effect that the solicitor may give legally aided advice and assistance to a qualified client, without any immediate supervision by the Board, up to the statutory limit; but he must not give or purport to give advice and assistance in respect of which remuneration is to be claimed from the Fund beyond that limit, except with the prior approval of the Board.

I have not rehearsed the submissions of parties in full. My reasons for not doing so are, first, that the submissions which were made to us were substantially the same as those made to, and fully recorded by, the Lord Ordinary, except that, before us, the Board did not finally advance the "principal contention" recorded by the Lord Ordinary:

"that a solicitor would require absolutely to cease acting as soon as the statutory limit on expenditure was reached"

(emphasis added), and, second, because it appeared to me that the submissions which we heard did not give sufficient weight to the provisions in secs. 33, 4 (2) (a) and 12 of the Act and in Sched. 3 to the 1987 Regulations. Approaching the matter as I have done, I am satisfied that if a solicitor, performing his duties under sec. 10 (1), comes to realise that the cost of giving advice and assistance is likely to exceed the current statutory limit, he must at once apply for approval to exceed the limit. If he is asked to give oral or written advice or assistance of the kind defined in sec. 6 (1) prior to receiving the approval of the Board, then he can decline to give that advice or can choose to give it without creating in himself any entitlement to claim it under sec. 12 either from the Fund or from any of the other sources of monies specified in that section.

It was also argued to us that the Lord Ordinary's decision was justified by reference to other provisions in the regulations already referred to. Regulation 17 allows the solicitor to submit an account to the Board for fees and outlays properly chargeable. Regulation 16 governing the fees and outlays allowable contains the provision that they "shall not exceed the limit applicable under section 10 of the Act as read with regulation 11". Regulation 11 provides that where at any time it appears to the solicitor that the cost of giving the advice and assistance is likely to exceed the limit, "he shall apply to the Board for its approval to an increased limit" providing information to enable the Board to consider and determine the application. Regulation 11 (2) provides:

"The Board, if it approves an application made under paragraph (1) above,—(a) shall authorise such increased limit as it thinks fit; and (b) may require that the advice and assistance be subject to such conditions, and limited to such subject matter … as it thinks fit."

In my opinion, the words "at any time" appearing in reg. 11 (1) are governed by what follows, namely, "Where at any time it appears to the solicitor that the cost … is likely to exceed the limit" (emphasis added). Accordingly the time that this regulation envisages is a time before the limit has been exceeded. He is thenrequired to apply for approval to an increased limit and he is obliged to state, among other things, the likely amount of the cost of giving the advice and assistance in the future. Thereafter, under reg. 11 (2) (b), the Board, if it approves the application, "may require that the advice and assistance be subject to such conditions, and limited to such subject matter … as it thinks fit". I do not see how the Board could impose such conditions or limit the advice and assistance to specified subject matter except in advance of the actual provision of the advice and assistance. Accordingly, it does not appear to me that on a proper understanding of these regulations anything in them detracts from the interpretation of sec. 10 which I have earlier indicated appears to me to be the correct one. I can find nothing in the regulations which is inconsistent with my understanding of the effect of sec. 10.

My reasons for disagreeing with the Lord Ordinary should now be clear. There was no dispute before him that the issue was properly open to judicial review for the reasons which the Lord Ordinary gives. I agree that he was right to reject the contention which he records as the principal contention advanced before him on behalf of the Board, namely that on a proper construction of sec. 10 a solicitor would require "absolutely" to cease acting as soon as the statutory limit on expenditure was reached; it was withdrawn in the course of the debate before us and my view of it has been fully expressed earlier. I agree with him in the view that sec. 31 (7) could not change the effect of sec. 10 if the latter did indeed contain an express provision to the effect that the Board originally contended for. I accept his view that the regulations themselves, apart from their reference to sec. 10 of the Act, would not exclude the possibility of effective approval by the Board ex post facto. Where I differ from him is in my view of secs. 4 (2) (a), 33 and, ultimately, of sec. 10 itself.

In the whole circumstances, I consider that the Lord Ordinary has misconstrued sec. 10 (1), has reached an incorrect decision and was wrong to reduce the determination of the auditor. I conclude that the proper course is to allow the reclaiming motion, to recall the interlocutor reclaimed against and to dismiss the petition.

LORD MORISON .—The amount which is in dispute in this case is the cost of work which fell within an increased limit of expenditure ultimately authorised by the Board, and which was actually, necessarily and reasonably done in connection with the matter upon which advice and assistance was given by the solicitors. The only ground upon which it is maintained that this sum is not due by the Board is that at the time when the work was done its authorisation of the increased limit had not yet been given. The Lord Ordinary noted that it was accepted that there would be no practical difference to the Board nor to the solicitors whether authorisation of an increased limit was given in advance or retrospectively. He said that a construction of the legislation which excluded a retrospective effect of authorisation was the less attractive. I agree with this view since it seems to me that exclusion of the retrospective effect provides no assistance to the Board in its control of expenditure and that it must lead to delay in the giving of advice and assistance by solicitors pending determination of an application by them for an increased limit. But such considerations can only arise if the relevant legislation is capable of being construed in such a way as to infer liability of the Board to pay the disputed sum.

The case was presented to us, and appears also to have been presented to the Lord Ordinary, as if it turned on a construction of sec. 10 of the Act. In my opinion this is an erroneous approach. The question whether the sum in dispute is due by the Board is regulated by the statutory provisions made for payment. Section 10 makes no provision regarding payment. The Board's obligation to pay any sum is provided for and restricted to those payments from the Legal Aid Fund which are specified in sec. 4 (2) of the Act. The corresponding entitlement of a solicitor to be paid for the provision of legal aid or advice and assistance under the Act is dealt with in sec. 33 (1), which provides for payment "in accordance with section 4 (2) (a) … in respect of any fees or outlays properly incurred". Provision in respect of fees and outlays allowable on taxation is made by reg. 16 of the Advice and Assistance (Scotland) Regulations 1987. These regulations have been made in exercise of powers conferred in the Act. It is only on the basis of the statutory provisions which I have mentioned that a claim for payment can be established.

So far as the regulations are concerned, they appear to me to be fully consistent with the view that payment may be due for advice and assistance provided in excess of a limit before an increase has been authorised. The provisions contained in reg. 16 restrict fees allowable on taxation to the limit "applicable under section 10 … as read with regulation 11". The limit applicable under sec. 10 was £50 at the material time. That limit is, however, subject to authorisation by the Board of an increase, as provided for in reg. 11. The authorisation which may be given in terms of the latter regulation is not expressly restricted as applying only to advice and assistance to be provided in the future, and I see no reason why any such restriction should be implied since it would in my view be unnecessary for the purpose of control by the Board of expenditure. The terms of the regulation are in my opinion fully consistent with authorisation of an increased limit applying both to advice and assistance to be provided in the future and to that which has already been provided in connection with the same matter, for example that which has been provided pending determination of an application for an increase. If payment of the disputed sum was a matter which fell to be determined exclusively by reference to these regulations, I should have held without hesitation that the Board's contentions were ill-founded.

But unfortunately (as it appears to me) the payments which are allowable on taxation in terms of reg. 16 must be held to be restricted to the sums which are specified in sec. 4 (2) of the Act. These sums include fees and outlays due to a solicitor which have been properly incurred by him "in connection with the provision, in accordance with this Act, of … advice and assistance". Unless the payment in dispute falls within this category, the Board has no power to pay it. There are a number of statutory provisions which bear on the question whether advice and assistance has been provided in accordance with the Act. These include the provisions contained in sec. 10, and it is only in this incidental way that it becomes necessary to consider the terms of that section.

I do not consider that any serious question can arise regarding the construction of sec. 10. It clearly prohibits the giving of advice and assistance costing more than the limit of £50 as soon as it appears to the solicitor that the work is likely to exceed that limit, except advice and assistance the giving of which has the Board's approval. It is not in dispute that it appeared to the solicitors that the advice and assistance in respect of which the sum in dispute was incurred was likely to cost more than the limit, nor that the giving of this advice and assistance did not have the Board's approval. It must follow that it was not given in accordance with the section, and there are no other provisions in the Act or regulations in accordance with which the solicitors were entitled to provide it. The sum in dispute is therefore not a sum which falls within those which are specified in sec. 4 (2) as being due by the Board.

The Lord Ordinary based his decision on the view that sec. 10 was directory and that it did not follow that if a solicitor breached the prohibition he would not be paid by the Board. I agree with him in both these respects. I do not consider that breach of the prohibition nullifies the actings of the solicitors which constituted that breach. But in respect of payment by the Board for these services the Lord Ordinary's attention does not appear to have been primarily directed to sec. 4, to which he only briefly refers. While it does not follow that a breach of the prohibition disentitles the solicitor to payment, it equally does not follow that payment for legal advice and assistance is due by the Board simply because it has been given. Payment can only be due if the remuneration is one of the sums mentioned in sec. 4 (2). For the reasons which I have given, the payment claimed in the present case is not one of these sums and the Board has therefore no power to make it.

I agree that the reclaiming motion should be allowed and that the petition should be dismissed.

LORD KINCRAIG .—Since drafting my opinion in this reclaiming motion I have had the opportunity of reading the opinion of your Lordship in the chair. I so thoroughly agree with it that it is now unnecessary for me to do other than concur with your Lordship's motion that this reclaiming motion should be granted, the interlocutor of the Lord Ordinary recalled, and the petition dismissed for the reasons given by your Lordship.

The petitioners thereafter appealed to the House of Lords. The appeal was heard in that House before Lord Keith of Kinkel, Lord Templeman, Lord Jauncey of Tullichettle, Lord Lowry and Lord Browne-Wilkinson on 2nd December 1991.

The arguments of counsel are sufficiently set forth in the speech of Lord Keith of Kinkel.