An update :Our order appealled to the Judge.

In a recent post i set out a recent matter which i had been involved in.

I can now report the matter is concluded and not going to trial.

The Client in question is exceptionally happy to have the matter closed and can now move on with their life.

The Client has gone from having a potential charging order on the horizon, to having no CCJ, no debt and legal fees covered by the opponent.


Our order “appealled” to the Judge

An interesting case came up recently which went to reinforce my view that if you are not sure of the arguable points in your case, or how to present them correctly in a Defence, then you should seek legal advice.

The case in question, as so many others do, involved a matter where a clients account had been purchased by a third-party who were seeking to recover the balance outstanding on a credit card account.

The matter ended with the Client being sued, there appeared to be a number of grounds of challenge in this matter, however due to the clients lack of understanding many of the key points were missed out of the Defence, instead there were a number of irrelevant quotes from cases which didn’t assist.

The case did not really get off the ground, as the Claimant applied for summary judgment and unfortunately for the client, they succeeded and judgment was granted. Thus leaving the client with not only the full balance now being payable but also costs, and a CCJ on the credit record.

At this point the client contacted us and we took the case on a CFA basis. We also found a barrister on a CFA also. We considered the judgment and identified a number of weaknesses within the judgment. We prepared the grounds of appeal and filed the appellants notice (Form N161) . We identified a number of points which the Client had not considered or had not argued correctly.

We drafted up a consent order which allowed the appeal by the consent of the parties, of course the appeal court needs to be satisfied that there is a good reason for allowing the appeal without hearing the parties as the Courts do not like to interfere with a judgment unless there are good grounds to do so but as long as there are grounds and neither of the parties isnt a child or under the Court of Protection then it should be straight forward.

There was a fair bit of tooing and froing between the parties, and eventually the parties agreed to the appeal being allowed by consent relying on CPR 52 PD52A Paragraph 6.4. All of the costs were paid by the opponent.

The Judgment should never have been granted, but the client simply was unable to present a convincing argument to the Judge and as a result the client lost. The Client was on a tilted playing field from the start as the barrister the Claimant sent was well versed in Consumer Credit Law but the Client wasnt, it was a case of the Claimant barrister had the Judge eating out of his hand while the Client was simply given short shrift.

The case was put back on an even keel and an amended Defence was prepared raising all of the keys issues which gave the client a chance at trial.

The key point here however is if you do feel out of your depth, you are merely going to cause yourself more problems if you go it alone. It costs nothing to get some advice and see if there are any firms willing to assist you on no win no fee.

At the end of the day, success can never be guaranteed, but with the right help, you can give yourself the best fighting chance available.

Dispelling the myths on section 78(1) Consumer Credit Act

A question which arises with regularity is can section 78(1) Consumer Credit Act 1974 provide a Defence to a claim?

In Cabot v Bachellier (2009), Cabot v Murphy, MBNA v McCullagh the County Court ruled that breach of s78 meant the Claims failed.

The Court of Appeal echoed this in Kotecha v Phoenix Recoveries.

In Kotecha, Lloyd LJ pointed out that s78 was suspensory and in the kotecha case, the s78 points hadn’t been argued before the lower Court although the issues were discernible on the papers. The Court of Appeal however did not give the creditor a blank canvas to work on, it set very strict time frames and the order said that if the Claimant failed to adhere to the Courts order the Claim would be struck out.

So in my view if the matter comes before a trial judge and a creditor hasnt complied with a statutory request then his claim should fail. Especially if the Creditor has been on notice in a Defence for a number of months that s78 is an issue and he does nothing to remedy this.

The creditors option of course is to seek an adjournment, but there is a helpful case on late adjournments called “Fitzroy Robinson vs Mentmore Towers [2009] EWHC 3070 (TCC)” and it does provide some assistance when a creditor tries to force an elevent hour adjournment to a case. Paragraph 9 of the judgment sets down the criteria.

That said, a creditor can of course remedy a breach of section 78(1) Consumer Credit Act 1974 at any time up to Judgment in the case although the Courts will most likely frown on such actions given s78 ought to be complied with within 12 working days, and per HHJ Waksmans ruling in Carey v HSBC Bank Plc the creditor ought to be able to comply fairly easily as most banks have sophisticated systems (yeah i did have a bit of a chuckle when i typed this) anyone remeber Harrison v Link Financial Limited? where MBNAs sophisticated systems were found to have systematically failed numerous times!! so yeah i remain unconvinced at the banks systems.

So what does the creditor need to do to comply with s78 (1) ?

Firstly you need to read the provision of the statute.

78 Duty to give information to debtor under running-account credit agreement..

(1)The creditor under a regulated agreement for running-account credit, within the prescribed period after receiving a request in writing to that effect from the debtor and payment of a fee of [F1£1], shall give the debtor a copy of the executed agreement (if any) and of any other document referred to in it, together with a statement signed by or on behalf of the creditor showing, according to the information to which it is practicable for him to refer,— .

(a)the state of the account, and .

(b)the amount, if any currently payable under the agreement by the debtor to the creditor, and .

(c)the amounts and due dates of any payments which, if the debtor does not draw further on the account, will later become payable under the agreement by the debtor to the creditor. .

(2)If the creditor possesses insufficient information to enable him to ascertain the amounts and dates mentioned in subsection (1)(c), he shall be taken to comply with that paragraph if his statement under subsection (1) gives the basis on which, under the regulated agreement, they would fall to be ascertained. .

(3)Subsection (1) does not apply to— .
(a)an agreement under which no sum is, or will or may become, payable by the debtor, or .
(b)a request made less than one month after a previous request under that subsection relating to the same agreement was complied with.

Carey v HSBC made it very clear that the creditor needs to provide a true copy of the executed agreement, and where the original had been varied either a copy of each discrete term that had been varied or a copy of the current terms and conditions as the contract stands at the date of the request. The Creditor does not need to send a photo copy of the original agreement although many people still think (wrongly) that they do.

The High Court in Carey ruled that the underlying purpose of s78 is for information, to give you the info you need about the terms of your contract. So a photo copy of the original isn’t needed, but what is needed is the creditor must produce in an easily legible format the terms of your contract.

Now the easiest way i have found to explain to people why the photocopy of the original is not needed is like this, if you think about a Data Subject Access request under the Data Protection Act 1998, you are entitled to the data within your bank statements, but what you’re not entitled to is an exact photo copy of each page of the bank statement, the Bank can give you the data printed on a toilet roll, or a scrap of paper, the form isn’t important, it’s the content that is important.

So apply the same view to s78 and you realise that a photo copy isn’t needed,  but a copy of the agreement is needed. The creditor can type the terms onto an A4 Sheet, or it can use a template which was in use at the time you took out your agreement and then enter your info.

The creditor has a duty to ensure the copy is an “honest and accurate” (see 53(12) Carey v HSBC Bank Plc) so it cannot be what the creditor thinks you might have signed, it must be accurate. The burden however rests on the debtor to say “it is not accurate because……..”

When i think of the s78 documents i see, i often find faults with what has been produced. Be it incomplete documents or the wrong terms, wrong interest rates, or just the documents are grossly illegible, it really does make you wonder how the banks, whose systems are supposed to be soo super sophisticated and exemplary , how then do they get it soo soo wrong?

The difficulty however i have when looking into s78 docs, is that unless the client can tell me what they did sign, or did not sign as the case maybe, and unless the client can say “Look the rate of interest there is wrong because when i opened the account it was X % ” or at least give me something to work with, then i am left with difficulty and can only look so far into the documentation.

The Courts have taken the view that the Debtor carries the burden to state what he did or did not sign, and therefore the debtor needs to set out also why the documents don’t comply with the s78 request. Now obviously if the documents aren’t easily legible then the creditor is in difficulty, but if the creditor produces a recon of the agreement which is legible, I don’t know whether the client signed that document or whether them terms were the terms of the agreement, so this is where the client needs to make matters clear.


So going back to s78(1) CCA 1974, to comply, the creditor must produce a copy of the orignal agreement, the current terms as varied or the latest copy of each notice of variation of each term that has been varied “Together with” a statement signed by or on behalf of the Creditor.

The words “together with” are very important, they do not mean the creditor can send things separately, or piecemeal. They must as a matter of common sense be sent together, ie at the same time if the creditor is to comply with s78(1). A recent case of HFO v Robinson confirmed this view was correct, although the case was a county court decision, nonetheless, i cannot see any other way to construe “together with” than “at the same time”.

Another point that is missed, is people complain that because the creditor fails to comply with s78(1) within the 12 working days limit that the agreement is unenforceable and they can stop paying. The 12 working days really is neither here nor there, if the creditor fails to comply within that time then yes they cannot enforce, but there really is little sanction for such failures, certainly the Consumer Credit Act 1974 does not prescribe any sanction other than the inability to enforce the agreement.

I have also seen it argued that the effect of non compliance with s78(1) is the same as the restrictions in s127(3) CCA. With respect to those views, it is plainly wrong. The route to section 127(3) requires an “improperly executed agreement” so for example,agreement taken out before 6th April 2007, not signed by the debtor or not containing the prescribed terms for that type of agreement. Section 65(1) CCA 1974 clearly states an improperly executed agreement can only be enforced by court order. s127(3) sets down the restrictions on enforcement. It is worth noting at this moment that an agreement will be improperly executed if it is not in the prescribed form, or not signed by the creditor, or misstates the APR etc, those breaches can be remedied by the Court using its powers under s127(1)&(2) CCA 1974. But that is going outside of the matters i am trying to address here. So, is a breach of s78(1) the same as the restrictions in s127(3) ? no plainly it isn’t. s78 can be remedied at any time, s127(3) cannot, once unenforceable always unenforceable. To quote Lord Hoffman in Dimond v Lovell (House of Lords) where the court finds the agreement is unenforceable the debtor does not have to pay, so clearly s78 does not come close to s127(3) CCA 1974 as McGuffick v RBS shows the breach of s78 does not entitle the debtor to stop paying whereas if the agreement were irredeemably unenforceable because the prescribed terms were missing or the agreement was not signed (as long as it was opened before 6th April 2007) .

All that would be achieved if you argue that the breach of s78 entitles you to stop payment is that you would show the opponent a distinct lack of knowledge of the Consumer Credit Act.


Consumer Credit Litigation

I was emailed a link to a website belonging to a firm of solicitors whom i am acquainted with via a number of successful litigations.

Their website can be found here

I note that they suggest a litigation review is necessary and they are entirely correct. Many creditors and their lawyers are quick to issue claims, but slow to check they have the evidence necessary to discharge the burden placed upon them by the litigation.

I have taken a quote direct from the website, as it is very Apt indeed.

Some common themes arising in defences to claims for monies owed under consumer credit agreements are whether:

  • A creditor has complied with its duties under section 78 of the Act to provide a copy
    of the credit agreement;
  • A compliant default notice has been served on the debtor under section 87 of the
    Act enabling the entire sum to be repayable immediately and permitting termination
    of the agreement;
  • The credit agreement was executed in compliance with the Act and contained
    all the prescribed terms at the time of the debtor signing the agreement;
  • There was mis-selling of PPI policies or whether the debtor can establish a
    claim under the newly introduced unfair relationship provisions.

And here’s why its very apt!!!!!

HFO Capital limited v Denis Robinson- The Claimant represented by Turnbull Rutherford Solicitors failed before Deputy District Judge Bradly to satisfy the Court that section 78(1) Consumer Credit Act 1974 had been complied with
HFO Capital Limited v Michael Burney- The Claimant represented by Turnbull Rutherford Solicitors failed to satisfy the District Judge that the Default notice was compliant with s87(1) Consumer Credit Act 1974. The Court ruling is on BAILII and can be found here

HFO Capital Limited v Roland Wegmuller- The Claimant represented by Turnbull Rutherford Solicitors failed to satisfy the Recorder Campbell at Birmingham County Court that the agreement contained the prescribed terms required by s61(1)(a) Consumer Credit Act 1974. I was the fee earner for this case too. The Judgment is here

So, yes, the above cases show that without a proper and adequate litigation review, it will be very costly if it goes wrong for the creditors, and quite rightly, if you bring a claim rife with errors, you deserve to be punished in costs when the Defendant exercises his or her right to a Defence and wins.

PC World / currys…..the mind boggles

Well ive had two experiences today which have made me conclude that PC world know as much about customer service as i know about quantum mechanics.

The first experience was entirely laughable, their call centre were outrageously stupid, did not understand the basic principles of the Sale of Goods Act 1979 as amended. gave woefully inadequate advice. The store lived up to the call centres stupidity and frankly when the manager said and i quote ” We will make this as less convenient as possible” yup i couldnt believe it myself but thats what he said, cos i asked ” so youre going to make this inconvenient then?” to which he replied “you know what i mean” well frankly i dont fooking know do i, because if you dont speak clearly and correctly how the hell am i supposed to know what he meant, i mean sorry but my crystal balls broken.

The worst was still to come, when i called Currys head office and ended up speaking to Mr Brainless who also had no idea what the law says about my rights to a repair refund or replacement, yes, see Sale of Goods Act 1979 its all there, section 14 for example.

Anyway, i was told a manger would call me back because i had my time wasted by a series of inaccurate peices of information which meant i had wasted my time over and over and guess what, yea they failed again and the manager never rang either. Bravo still at least they were consistent, consistently poor!!!

So, the second time today, i reserved an item with PC world. It was supposed to be that you reserve the item, and collect it from the store to speed up the process. Well, i reserved the item, and went to the store, spent 30 minutes queing up only to be told that it would have been quicker if i had gone to the store and approached a member of staff. For FC*K SAKE. and then, they had the audacity to try and sell me their warranty , er they got told to insert their warranty where the sun will never shine

Well done Currys and PC world, you win the incompetent fools of the week award.

The danger of some internet forums

I was horrified to learn about some really appalling advice which had been given out on an internet forum which will remain nameless, but i no longer visit them.

The basis of the advice was it seems not to pursue a valid claim against a third party because there was a fear that the sums may take the debt outside of the small claims track. The second piece of advice was even more bizarre, in that a Counter claim was launched for recovery of monies paid against a party whom did not have the benefit of the monies in any event. Of course, the other point to note (which it seems the person offering the advice totally and arguably negligently missed) was that the target of the Courter-claim ought to have been the original creditor, not the assignee. In fact the case of Jones v Link Financial Limited ought to have put that to bed in any event.

But to make matters worst, the party was told because its small claim its safe from costs. Well two points spring to mind.

Firstly, small claims is only small claims when its allocated there by a judge, a judge can decide that the case even if the value is under £5k can be a fast track matter. One merely need look at CPR 26 to see this. I had a case with the balance of £1500 transferred to the High Court before HHJ Chambers purely on complexity of the arguments.

Secondly, even thought CPR rule 27.14 says no costs should be payable, a recent case of Shaw v Nine Regions said that if the contract provides a right to recover reasonable costs in recovering a debt, then the winner may well be entitled to reclaim his costs in any event.

the above link shows the risks even in the small claims track with these cases. Also, there was a case which i am aware of where the Court ordered £27k costs against a debt of £3k.

Had that been considered, it may well have led the person not to file their speculative counter claim. This is not the first time i have come across appalling advice from this internet source, i represented a client in an appeal whereby the “experts” told him to abandon the arguments that would have won him the day in favour of arguments which were more comical than Monty Python!!!. Fortunately we were instructed, appealed and the matter was swiftly brought to a conclusion that didnt leave the client with an £18k judgment unlike the previous advice.

So, no matter what forum you got to, please make sure if you are needing legal advice, SPEAK TO A LAWYER and not one of the armchair variety.

Restons Solicitors article on HFO Capital Limited v Wegmuller.

I was trawling the net the other day and i was fortunate (although Restons may disagree here) to find the Restons website.

I must say a nice looking site, however, its a pity about the Wegmuller report, because its wide of the mark. The author clearly has not given sufficient attention to the Judgment of Recorder Campbell.

In the case of HFO Capital Limited v Wegmuller, Mr Recorder Campbell considered the allegation by Mr Wegmuller that the Barclaycard agreement (subsequently  acquired by HFO)  he signed in the mid-1990’s failed to contain the prescribed terms and therefore did not comply with Section 61 of the CCA.  After making reference to “Carey v HSBC Plc” – in particular those passages which dealt with what the Act required the customer to sign – the Recorder noted the court had not been provided either with a copy of the original agreement nor a reconstitution of it.

That is entirely wrong. Before the Court were the following,

1) A copy of the signed application form.

2) Terms and conditions which clearly were provided with the card, in fact they stated that they were accompanying the card!!

3) a reconstitution of the agreement

None of which assist where the underlying agreement is unenforceable, clearly you cannot reconstitute to make a bad agreement good. As they say, you cannot polish a turd, if its a bad agreement, no amount of reconstituting can put it right!!!!

The problems with the case were not as the author of the Restons article suggests, and in fact i made an application to the Court prior to the hearing for an order that the Claimant do provide a reconstitution of the original agreement. The Claimant provided the disclosure, and the reconstituted agreement was entirely supportive of Mr Wegmullers views.

Although Mr Wegmuller actually acknowledged difficulty in recollecting exactly what he signed, the Recorder decided that in the absence of any direct evidence from either Barclaycard or HFO, as to account set up procedures/documentation, Section 61 compliance could not be proved.  Therefore the debt recovery claim brought by HFO was dismissed.

Ok, now its helpful to look at the Wegmuller ruling here.

14. I pause there for a moment. It is worth noting that none of those three terms is actually visible on the copy application form document in the bundle that was signed by the defendant on 25th March 1996.

Clearly Recorder Campbell found the prescribed terms were not on the application Mr Wegmuller signed. That was obvious, contrary to the authors assertion the agreement was before the Court, otherwise how did the recorder make such findings??

Worse was to follow as Mr Wegmuller had instructed a firm of solicitors who are well known for representing customers who wish to challenge their liability under  regulated agreements on the grounds of non CCA compliance.  That firm (and similar) will take comfort from this ruling – not least the award of costs made in their favour.

That Firm, what an amusing comment, it seems to be that they cant even bring themselves to mention our name, still anyone who reads the Wegmuller ruling will know who we are. I would also point out that every one is entitled to be legally represented, if the banks dont like losing money there is a solution, GET IT RIGHT- GET YOUR PAPERS IN ORDER and maybe even invest in lawyers who know about consumer credit law. On the point of costs, well yes, isnt it the case that costs follow the event? if the lender had won he would have wanted his costs surely? or would they be kind and say its ok dont bother paying? for goodness sakes , the mind really boggles. So yes, we won the case, yes we got paid, yes the client didnt have to pay his unenforceable debt and yes we were on a CFA so got an uplift.

Although perhaps a reflection of the quality of evidence before the Court in that particular case, the message is clear – when proceedings are defended, debt purchasers need to ensure that a litigation risk assessment is carried out on every “enforceability” case.  The reality is that for the purposes of both litigation and regulatory compliance they are an “extension” of the original lender.  Implementation of effective arrangements will ensure recoveries  are maximised and defeat/dissuade speculative and time-consuming challenges/defences.

With respect, i find it grossly insulting if the author is suggesting that Mr Wegmullers Defence was speculative. It was anything but. There were identified breaches of s61,62,63,78,86,87 Consumer credit Act. As for HFO Capitals Default notices one merely need read HFO Capital v Michael Burney which is on BAILII and can be found here
We have challenged that certain creditor before, and have at least 20 victories under our belts with them so if our defences are speculative the judges must clearly be missing something. As far as it goes, the failings were no the fault of our clients, they were the fault of the creditors and their stupidity in rushing off to court without making sure they had a case that was winnable. I have a wealth of rulings in the County Court and High Court also that supports the arguments i have used in cases such as Wegmuller, none of which can be called speculative.

On a closing point, i must remind myself of the words of the Vice Chancellor in the case of Wilson v First County Trust Ltd – [2001] 3 All ER 229 where Sir Andrew Morritt VC said

In effect, the creditor–by failing to ensure that he obtained a document signed by the debtor which contained all the prescribed terms–must (in the light of the provisions in ss 65(1) and 127(3) of the 1974 Act) be taken to have made a voluntary disposition, or gift,of the loan moneys to the debtor. The creditor had chosen to part with the moneys in circumstances in which it was never entitled to have them repaid;

It seems pretty clear that if a lender fails to jump through the hoops set down by the legislation then he deserves all the hassle he gets. Lets also not forget that many lenders DID Get it wrong over the last 20 years, and now their errors are coming to light to their detriment sadly.

my dear old dad vs Lloyds TSB

I never thought i would see the day when i had to give advice to my dad about the law relating to financial institutions let alone actually have to represent him but that day came recently.

I was talking to my dad about his loans that he had with Lloyds TSB and he happend to mention a letter that he had recieved from Lloyds which he came accross by accident while looking through his files.

What had happened was that dad was made redundant around February this year, fortunately his loan ended around the beginning of February. This much i was aware of.

However, what i was unaware of, was that Dad had gone into the branch of Lloyds TSB when he took out his loan, and the advisor told him that she strongly recommended that he took out the loan, there were witnesses fortunatley to this. My dad replied that he would only take out the PPI upon condition that it provided him with redundancy cover past his 65th birthday, with it being recorded that if it did not then he did not want it end of story. My dad explained that he was planning on working on until he was 68 or 69 so that his mortgage could be paid, and therefore any PPI needs to provide redundancy cover until he finished work.

He was assured that it did.

Anyway, dad found a letter from lloyds telling him that since he was 65 his ppi was no longer covering him.

To say i was very sad and had a sense of humour failure would be an understatement. So, off we went to Lloyds TSB customer services, dad gave me full authority to deal with the account too, so it was open season on Lloyds.

Not only had they missold dad PPI on this case, but on all his other loans going back years.
So, i got hold of Lloyds, set out clearly that this was an advised sale, despite them trying to say it was, the fact they said ” we strongly recommend you take this”  is clearly an advised sale. They also argued limitation, but sadly they lost that one too, as i argued that the misrepresentation made the relationship unfair and therefore, Patel v Patel [2009] EWHC 3264 (QB) (10 December 2009) clearly says that if the relationship is unfair within s140(a) CCA 1974, then the limitation period is 6 years from the end of the relationship. Sorry Lloyd’s TSB you lost again.
So, after an investigation, Lloyds decided to do the right thing and refunded my Dad all of his PPI with interest.

Very happy with that result.

Conditional Fee Agreement- Free representation? no not quite

I have had a lot of people ask me about Conditional Fee Agreements aka No Win No Fee and they seem to have this view that they represented “FREE” representation. They do not, what a CFA represents is what it says, No Win No Fee.
If i took a case on no win no fee, then would i expect to be paid if i won? hell yes.

The problem seems to come from the fact that some people arent used to dealing with solicitors, i was with my dad once many years ago when he went to see his solicitor and i recall his lawyer saying ” to be able to start work we will need £1000 on account of costs” and i asked my dad why he had to pay before he had the service, well that is how most law firms who are privately funded work. You pay money into their client account, they do the work and charge against your account. That is not how a CFA works.
With a CFA, you effectively take away the client paying the money in to the client account and the billing as you go along, but that doesnt mean that there is no bill accruing just that its not being funded as the case progresses. There is still a bill to pay, there has to be, if there was no bill, ie i was in agreement that im going to work for free for a year on a case, then there would be nothing to recover from the opponent.

I confess i do not like costs at all, the costs practice directions are boring, but to put it bluntly the indemnity principle means  that the winning party cannot recover more costs from the losing party than he himself would be liable to pay his own solicitors, so to put it short if i was working for free for a client but was planning on charging the opponent then i couldnt recover my fee from the opponent because the indemnity principle says the opponent has nothing to pay. I hope that makes sense.

So there has to be a bill accruing but you just dont have to pay it til the end of the case. Does that make sense? i hope so, but what you do have to pay  is disbursements, such as court fees, and such as barristers fees if necessary.

Also, there is the success-fee, which is payable. The success fee is set normally at 100% of the basic costs if the matter progresses to trial.

Most people complain about the charging of a success fee, but heres the problem, imagine you work at Tesco or ASDA, and your boss says to you, ill pay you if you can stack all the shelves perfectly for the next year, but if you dont then i wont. Would you work under them terms? my guess is no, yet i am expected to work with no income for nearly a year ( yes fast track trials normally take 30 weeks to get to trial)  with the risk of not even getting paid at all. If the success-fee is removed then i am risking working for nothing with no incentive!! It must be remembered that the firm i work for is a business afterall, but we do not work for the banks,DCAs , we represent the consumers only despite the fact that we have had offers to work for the DCAs . We have to make a profit from somewhere, i personally have kinds who need clothing, feeding etc, and i have to earn my living at the end of the day like everyone else.

Personally i am always happy to look at no win no fee to help people get the right representation with the right funding methods. However, there are an ever increasing number of people who are being mis-advised on certain internet arenas that no win no fee means you will get everything for free.

I found a copy of the law society CFA on the internet and thought it would be a good idea to post it here so that people can actually see what a CFA looks like. This CFA is for personal injury but they are in the main the same

I am not an expert on CFAs, but if you have any questions about them i will try and answer as honestly as i can

What You Need to Know About a CFA


Definitions of words used in this document and the accompanying CFA are explained at the end of this document.

What do I pay if I win?


If you win your claim, you pay our basic charges, our disbursements and a success fee. The amount of these is not based on or limited by the damages. You can claim from your opponent part or all of our basic charges, our disbursements, a success fee and insurance premium.

It may be that your opponent makes a Part 36 offer or payment which you reject on our advice and your claim for damages goes ahead to trial where you recover damages that are less than that offer or payment. Refer to the “Paying Us” section in the CFA document to establish costs we will be seeking for the work done after we received notice of the offer or payment.

If you receive interim damages, we may require you to pay our disbursements at that point as well as a reasonable amount for our future disbursements.

If you receive provisional damages, we are entitled to payment of our basic charges, our disbursements and success fee at that point.

If you win overall but on the way lose an interim hearing, you may be required to pay your opponent’s charges of that hearing.

If on the way to winning or losing you are awarded any costs, by agreement or court order, then we are entitled to payment of those costs, together with a success fee on those charges if you win overall.

What do I pay if I lose?


If you lose, you pay your opponent’s charges and disbursements. You may be able to take out an insurance policy against this risk. If you lose, you do not pay our charges but we may require you to pay our disbursements.

Ending this agreement


If you end this agreement before you win or lose, you pay our basic charges and disbursements. If you go on to win, you also pay a success fee.

We may end this agreement before you win or lose.

Basic charges


These are for work done from now until this agreement ends. These are subject to review.





How we calculate our basic charges


These are calculated for each hour engaged on your matter. Routine letters and telephone calls will be charged as units of one tenth of an hour. Other letters and telephone calls will be charged on a time basis. The hourly rates are:

Grade of Fee Earner

Hourly Rate


Solicitors with over 8 years experience after qualification


Solicitors with over four years’ experienceafter qualification


Other solicitors and legal executives andother staff of equivalent experience


Trainee solicitors and other staff of equivalent Experience

We review the hourly rate on [review date] and we will notify you of any change in the rate in writing.

Road Traffic Accidents


[If your claim is settled before proceedings are issued, for less than £10,000, our basic costs will be £800; plus 20% of the damages agreed up to £5,000; and 15% of the damages agreed between £5,000 and £10,000.] [If you live in London, these costs will be increased by 12.5%].

These costs are fixed by the Civil Procedure Rules.

Success fee


The success fee percentage set out in the agreement reflects the following:

(a) the fact that if you lose, we will not earn anything;

(b) our assessment of the risks of your case;

(c) any other appropriate matters;

(d) the fact that if you win we will not be paid our basic charges until the end of the


(e) our arrangements with you about paying disbursements.

Value added tax (VAT)

We add VAT, at the rate (now [………]%) that applies when the work is done, to the total of the basic charges and success fee.

The Insurance Policy


In all the circumstances and on the information currently available to us, we believe, that a contract of insurance with [……………..] is appropriate to cover your opponent’s charges and disbursements in case you lose.

This is because

You do not have an existing or satisfactory insurance that would cover the costs of

making this claim. The policy we recommend will pay:


(a) the costs of the other party in the event that the claim fails, to a maximum of £X;

(b) all your disbursements if your claim fails.

(c) [add other key features where necessary such as, our costs and the other

side’s costs (without deduction from your damages) if you fail to beat an (Part

36) Offer to Settle your claim, which you rejected following our advice].


[We cannot identify a policy which meets your needs but our recommended policy is the closest that we can discover within the products that we have searched. It does not meet your needs in the following respects:

(a) it has an excess of £Z

(b) the maximum cover is £ZZ]



[We cannot obtain an insurance policy at this stage but we shall continue to look for one and if we are successful in our search then we shall advise you at that stage of the benefits of the policy and purchasing it]


[NB. The italicised reasons in set out are examples only. Your solicitor must consider your individual circumstances and set out the reasons that apply].


Law Society Conditions


The Law Society Conditions below are part of this agreement. Any amendments or additions to them will apply to you. You should read the conditions carefully and ask us about anything you find unclear.

Our responsibilities


We must:

  • always act in your best interests, subject to our duty to the court;
  • explain to you the risks and benefits of taking legal action;
  • give you our best advice about whether to accept any offer of settlement;
  • give you the best information possible about the likely costs of your claim for damages.


Your responsibilities

You must:

  • give us instructions that allow us to do our work properly;
  • not ask us to work in an improper or unreasonable way;
  • not deliberately mislead us;
  • co-operate with us;
  • go to any medical or expert examination or court hearing.


Dealing with costs if you win

  • You are liable to pay all our basic charges, our disbursements and success fee.
  • Normally, you can claim part or all of our basic charges, our disbursements success fee and insurance premium from your opponent.
  • If we and your opponent cannot agree the amount, the court will decide how much you can recover. If the amount agreed or allowed by the court does not cover all our basic charges and our disbursements, then you pay the difference.
  • You will not be entitled to recover from your opponent the part of the success fee that relates to the cost to us of postponing receipt of our charges and our disbursements. This remains payable by you.
  • You agree that after winning, the reasons for setting the success fee at the amount stated may be disclosed:

(i)  to the court and any other person required by the court;

(ii) to your opponent in order to gain his or her agreement to pay the success        fee.

  • If the court carries out an assessment and reduces the success fee because the percentage agreed was unreasonable in view of what we knew or should have known when it was agreed, then the amount reduced ceases to be payable unless the court is satisfied that it should continue to be payable.
  • If we agree with your opponent that the success fee is to be paid at a lower percentage than is set out in this agreement, then the success fee percentage will be reduced accordingly unless the court is satisfied that the full amount is payable.
  • It may happen that your opponent makes an offer of one amount that includes payment of our basic charges and a success fee. If so, unless we consent, you agree not to tell us to accept the offer if it includes payment of the success fee at a lower rate than is set out in this agreement.
  • If your opponent is receiving Community Legal Service funding, we are unlikely to get any money from him or her. So if this happens, you have to pay us our basic charges, disbursements and success fee.

As with the costs in general, you remain ultimately responsible for paying our success fee.

You agree to pay into a designated account any cheque received by you or by us from your opponent and made payable to you. Out of the money, you agree to let us take the balance of the basic charges; success fee; insurance premium; our remaining disbursements; and VAT.

You take the rest.

We are allowed to keep any interest your opponent pays on the charges.

If your opponent fails to pay


If your opponent does not pay any damages or charges owed to you, we have the right to take recovery action in your name to enforce a judgment, order or agreement. The charges of this action become part of the basic charges.

Payment for advocacy


The cost of advocacy and any other work by us, or by any solicitor agent on our behalf forms part of our basic charges. We shall discuss with you the identity of any barrister instructed, and the arrangements made for payment.

Barristers who have a conditional fee agreement with us


If you win, you are normally entitled to recover their fee and success fee from your opponent. The barrister’s success fee is shown in the separate conditional fee agreement we make with the barrister. We will discuss the barrister’s success fee with you before we instruct him or her. If you lose, you pay the barrister nothing.

Barristers who do not have a conditional fee agreement with us


If you win, then you will normally be entitled to recover all or part of their fee from your opponent. If you lose, then you must pay their fee.

What happens when this agreement ends before your claim for damages ends?


(a)          Paying us if you end this agreement


You can end the agreement at any time. We then have the right to decide whether you must:

  • pay our basic charges and our disbursements including barristers’ fees but not the success fee when we ask for them; or
  • pay our basic charges, and our disbursements including barristers’ fees and success fees if you go on to win your claim for damages.


(b) Paying us if we end this agreement

(i) We can end this agreement if you do not keep to your responsibilities. We then have the right to decide whether you must:

  • pay our basic charges and our disbursements including barristers’ fees but not the success fee when we ask for them; or
  • pay our basic charges and our disbursements including barristers’ fees and success fees if you go on to win your claim for damages.

(ii) We can end this agreement if we believe you are unlikely to win. If this happens, you will only have to pay our disbursements. These will include barristers’ fees if the

barrister does not have a conditional fee agreement with us.

(iii) We can end this agreement if you reject our opinion about making a settlement with your opponent. You must then:

  • pay the basic charges and our disbursements, including barristers’ fees;
  • pay the success fee if you go on to win your claim for damages.

If you ask us to get a second opinion from a specialist solicitor outside our firm, we will do so. You pay the cost of a second opinion.

(iv) We can end this agreement if you do not pay your insurance premium when asked to do so.


(c) Death


This agreement automatically ends if you die before your claim for damages is concluded. We will be entitled to recover our basic charges up to the date of your death from your estate.

If your personal representatives wish to continue your claim for damages, we may offer them a new conditional fee agreement, as long as they agree to pay the success fee on our basic charges from the beginning of the agreement with you.


What happens after this agreement ends

After this agreement ends, we may apply to have our name removed from the record of any court proceedings in which we are acting unless you have another form of funding and ask us to work for you.

We have the right to preserve our lien unless another solicitor working for you undertakes to pay us what we are owed including a success fee if you win.


Explanation of words used

(a) Advocacy

Appearing for you at court hearings.

(b) Basic charges

Our charges for the legal work we do on your claim for damages.

(c) Claim

Your demand for damages for personal injury whether or not court proceedings are issued.

(d) Counterclaim

A claim that your opponent makes against you in response to your claim.

(e) Damages

Money that you win whether by a court decision or settlement.

(f) Our disbursements

Payment we make on your behalf such as:

  • court fees;
  • experts’ fees;
  • accident report fees;
  • travelling expenses.

(g) Interim damages

Money that a court says your opponent must pay or your opponent agrees to pay while waiting for a settlement or the court’s final decision.

(h) Interim hearing

A court hearing that is not final.

(i) Lien

Our right to keep all papers, documents, money or other property held on your behalf until all money due to us is paid. A lien may be applied after this agreement ends.

(j) Lose

The court has dismissed your claim or you have stopped it on our advice.

(k) Part 36 offers or payments


An offer to settle your claim made in accordance with Part 36 of the Civil Procedure Rules.

(l) Provisional damages

Money that a court says your opponent must pay or your opponent agrees to pay, on the basis that you will be able to go back to court at a future date for further damages if:

  • you develop a serious disease; or
  • your condition deteriorates;

in a way that has been proved or admitted to be linked to your personal injury claim.

(m) Success fee

The percentage of basic charges that we add to your bill if you win your claim for damages and that we will seek to recover from your opponent.

(n) Trial

The final contested hearing or the contested hearing of any issue to be tried separately and a reference to a claim concluding at trial includes a claim settled after the trial has commenced or a judgment.

(o) Win

Your claim for damages is finally decided in your favour, whether by a court decision or an agreement to pay you damages or in any way that you derive benefit from pursuing the claim.

‘Finally’ means that your opponent:

  • is not allowed to appeal against the court decision; or
  • has not appealed in time; or
  • has lost any appeal.

Jones v Link Financail Limited

I often keep my finger on the pulse of High Court cases involving Link Financial Limited , especially after our victory against them in Harrison.

I came across a case today called Jones v Link. It was a very pleasing case indeed, as it torpedoes these debt purchasers who try to argue that they merely purchased the debt as an assignee and therefore the Consumer Credit Act does not apply to them.

Cabot were prime at doing this, as were Arrow Global, however the High Court has now ruled that the Assignee is the Creditor for litigation, therefore this “were not the creditor” argument is no more (unless there is a further Appeal of course in Jones)

So debt purchase companies, you do have to comply with the Consumer Credit Act, if a debtor makes a statutory request for a copy of the agreement under s78 CCA for example, and the agreement is live and not been terminated, then you cannot say you arent the creditor. And believe me, if you do on a case im involved with, ill slap a copy on Jones on the table quicker than you can say im not the creditor.

The case can be found here